Source: The Edge
Investors from the United States (US) and China seem to have confidence in Malaysia's dynamic and robust business environment, which is supported by an open market-oriented economy and the government's pro-business policies, said the International Trade and Industry Ministry (MITI).
To mitigate the trade and investment risk due to the US-China trade war, MITI, together with the Malaysia External Trade Development Corporation and Malaysian Investment Development Authority, had held promotional programmes in both countries, it said in a written reply posted on the Parliament's website today.
The ministry was responding to Tan Kok Wai's (PH-Cheras) query on the gains and losses experienced by Malaysia, following the trade war between the world's two largest economies, as well as on the country's strategies to cope with the challenges.
MITI reiterated that Malaysia's trade with China eased by 1.2% year-on-year to RM203.73 billion during the January-August period this year.
Exports to China fell by a marginal 0.1% to RM88.96 billion due to lower exports of electrical and electronics (E&E) products, rubber products, crude petroleum, as well as optical and scientific equipment, it said.
“However, Malaysia saw an expansion in exports to China for liquefied natural gas, chemicals and chemical products, iron and steel products, as well as manufactures of metals, while imports from China recorded a two per cent decline to RM114.77 billion,” the ministry said.
Meanwhile, Malaysia's trade with the US grew by 4.9% to RM106.48 billion in the first eight months of 2019, against the corresponding period last year, it said.
The country's exports to the US increased 4.3% to RM61.77 billion, driven by higher exports of E&E products, wood products, manufactures of plastics, processed food and rubber products.
Total imports from the US also went up, by 5.6% to RM44.71 billion.
According to MITI, the protracted trade war can potentially benefit Malaysia due to the possibility of investment diversion by large Chinese companies and multinationals to the ASEAN region, including this country.
“The investment diversion or investment relocation will drive trade and investment inflow into ASEAN countries, including Malaysia,” it noted.
To-date, the United States remains the biggest contributor to foreign investments in Malaysia, followed by China.
On total investments in the manufacturing sector approved between January and June 2019, MITI said they comprised 49 projects from the US worth RM11.7 billion and 30 projects from China valued at RM4.8 billion.
These projects were expected to create 7,471 job opportunitie, it added.