The Effect of the US-China trade war on Malaysia’s Economy

by HAL | June 2, 2019

The growth of Malaysia’s economy is set to pick up an extra 0.1 percentage from organizations moving manufacturing out of China because of the continuous trade war between China and the US, as indicated by an economic advisor to Prime Minister, Mahathir Mohamad.

In recent times, experts have referred to Malaysia as one of the nations that could profit from the trade war between the world’s two main economies. That is on the grounds that companies based in China may look to find a way round raised U.S. taxes by moving a portion of their operations to areas in Southeast Asia, for example, Malaysia, Thailand, and Vietnam.

The anticipated advantages from the trade war will add to growth speed in Malaysia, which is rising as consumption and investments in the country improve, said Muhammed.

Numerous investors had avoided investing in Malaysia after the general elections in 2018. The Mahathir-led Pakatan Harapan unexpectedly overthrown Barisan Nasional, an alliance that had ruled the country for over 60 years.

Muhammed said the government is dealing with reestablishing certainty among investors. He said the country is concentrating on pulling in “real investments,” which alludes to foreign organizations setting up operations in Malaysia or existing firms in the country extending their reach.

He also added that to do that, the government is attempting to improve incentives to organizations and to streamline the investment approval process.

Do you think Malaysia will get the predicted benefit of the trade war?