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Officially you need to have a valid
International Driver License.
In Practice I was never asked to provide one. My Swiss driver licence was always accepted. But one day it happened - and I was pulled to the side.
The Policee asked: "How long are youy already living here?"
Me: "Since 10 years."
Poliece: "Then you need to have a Malay Driver License. I will give you a fine.
Do you agree that you get a fine?"
Me: "No. Nobody ever told me that I need to change the license."
Poliece: " Ok, then I don't give you a fine today - but you need to change it."
Me: "Yes, I understand. Thank you officer."
Most western Driver Licence will be accepted to be transformed into a Malay Licence.
Officially, after being here for 3 months, you should have a Malay Licence.
If you want to get an International Driver Licence, or a Malay Licence, this has to be done on the mainland. It can not be done here - but the JPJ (where they register the cars and motorbikes and where you have to buy the Road Tax) can help you and send all the necessary papers to the mainland for you.
When driving here be aware, that - although Langkawi has a Driving School and organises this licencing professionally - as far as I can see - there are still people here who drive without a proper licence.
These is done by Malays and by foreigners.
A friend of mine, from Indonesia, recently went back to his home town, and got his driver licence by paying the equivalent of about 150 USD. He had not to make any test, nor to show that he can drive. This driver licence seems to be accepted here.
Langkawi seems to be divided in different regions with different police authorities.
On the 'big' roads there is often a Police Control. They mainly check if you wear a helmet on the motorbike, whether you wear your Seat Belts in the car, whether your Driver Licence is still valid, and if you have paid the road tax (which means also that you are insured, as you will only get the road tax if you have paid your insurance).
On the small roads out in the Kampungs, police will not bother the locals on the motorbikes to wear a helmet, or to have properly entertained bikes with a light at night, or to drive on the proper side of the road (the left side here!) . . .
So drive carefully.
BTW: Since the beginning of the year 2009, seat belts are compulsory, not just for passengers in the front seats but for passengers in the back seats as well.