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Abstract
Malaysia has successfully diversified its economy from initially agricultural- and commodity-based into the services- and manufacturing-dominant current economy. The country's GDP remains sustainable and competitive, increased at an average rate of 6.0 per cent from 1970 to 2018. The country's Gross National Income (GNI) per capita also rose from RM1,070 to RM43,307 over the same period. However, along with economic prosperity, there is a multi-dimensional imbalance. Among them is the development gap between states. This study analyses the inequality gap between states in Malaysia for the period 2005 to 2018 through the Williamson Index approach and examines the sigma convergence flows on several key factors that lead to inequalities. Through these techniques, the inter-state development gap is widened, and the significant inequalities between states are perceived due to the uneven industrial level among the states. Continuous efforts of inclusive economic management from the Government and the full involvement of the peoples and the private sector can bridge the development gap between states in Malaysia.