PETALING JAYA: The impact of Donald Trump’s second term as US President on trade could be partially offset by strong domestic demand and making sure Malaysia works closely with its Asean partners, says an industry leader.
The Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) president Datuk Ng Yih Pyng also suggested the government make sure Malaysia works closely with Asean to continue diversifying its economy, strengthening regional cooperation and expanding trade ties through agreements like the Asean–China Free Trade Area (ACFTA), Regional Comprehensive Economic Partnership (RCEP), and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Ng added that Asean businesses should build strategic partnerships with non-traditional countries to counterbalance risks from US economic policies.
In Malaysia, he said, businesses and manufacturers should focus on cost competitiveness, process efficiency, product quality, and diversifying supply chains and markets to mitigate the impact of trade conflicts.
“Businesses need to stay up to speed with changes in global trade flows caused by these conflicts.
“They should continuously adjust their supply chains, seek suppliers from other regions, and diversify into different sectors and markets to avoid relying on any single one,” he said.
Malaysia, he added, needs to strengthen its economic strategies to manage the potential risks from changing global trade dynamics, especially due to US policies under a second Trump term.
He said the likelihood of increased tariffs under the incoming US President and his economic and investment plans on immigration, energy and tax, along with incentives to encourage US companies to return, could cause significant changes in the global economy, affecting capital flows and financial markets.
“These protective policies are expected to disrupt trade and investment flows into emerging markets including Asean,” he said.
Asean is the fourth-largest trading partner of the United States, exporting various raw materials and assembled goods like electronic components, apparel, footwear and tyres.
Meanwhile, it imports products such as electrical machinery, petroleum oils, soybeans and aircraft. Increased tariffs could make Asean goods less competitive in the US market.
Ng pointed out that Malaysia’s strategic location, liberal trade policies, and focus on regional agreements make it an attractive destination for investors.
To strengthen this position, he recommended further integration through RCEP and ACFTA, focusing on trade liberalisation and investment facilitation.
He called for support for SMEs through export credit schemes, reducing import duties on raw materials, and helping businesses explore new markets and diversify supply chains.
Ng also advocated for incentives for multinational companies to establish regional hubs in Malaysia.
Expanding trade with the Middle East, Africa and Asia Pacific, as well as strengthening ties with the European Union, is crucial, he said.
