I spend a lot of time in Malaysia for business and as a whole it is nowhere near Taiwan in terms of general living standards. I love to visit but I couldn't live there.
I don't see Malaysia becoming a true first world country any time soon because it suffers from the same segregational mindset as the Philippines, Indonesia, Thailand etc. - build new, flashy tourist areas on foreign money and make sure all the plebby locals are kept away. As far as any tourists are concerned you have a wealthy, modern country but the proletarians' lifestyle just gets shittier.
Some people have mentioned that the food and transport in KL are great. Yes, if you can afford it there are better western food options than Taiwan and they have a monorail serving the wealthier parts of town. However once you leave that monorail area everything becomes distinctly third world, and having so many poor Malaysians looking on at all this wealth is a recipe for disaster.
Also as far as I'm concerned any country that requires fishing for coins to take a shit is not worth my time. That includes most of Europe.