A view of Kuala Lumpur, the capital city of Malaysia (Photo: New Straits Times)Hanoi (VNA) – Malaysian Finance Minister Lim GuanEng has said the permanent reorientation of the global supply chain due to theUS-China trade war can be a golden opportunity to attract new investment andreverse Malaysia's premature deindustrialisation.
In a recent address at the US’ University ofCalifornia Berkeley, he said the trade war between the two economic giants hasshifted the entire global supply chain, causing a seismic shift in trade,capital flows and technology.
Various firms are searching for safe havens toavoid being caught in the trade war between China and the US. Several SoutheastAsian countries, including Malaysia, have begun to experience increased foreigninvestment resulting from trade and investment diversion caused by the tradewar, he noted.
According to the minister, Malaysia approved49.5 billion RM (12 billion USD) in foreign investments in the first half of2019, doubling the 25.1 billion RM (6 billion USD) in the same period lastyear. A majority of the approved investment was within the manufacturingsector.
The US was the biggest source of approvedinvestment worth 11.7 billion RM (2.8 billion USD), followed by China with 4.8billion RM (1.15 billion USD).
Lim Guan Eng said his country has been lucky andexhibiting resilience amid external turbulence. In the second quarter of 2019,its gross domestic product (GDP) growth accelerated to 4.9 percent from 4.5percent in the first quarter, making it among the few countries in the worldthat experienced faster GDP growth during the period.
However, he said, despite the short-term gains,in the long run there are no winners in trade wars. If the trade tensionpersists and worsens, the global pie would shrink, and no amount of trade andinvestment diversion would suffice to counter the potential loss in globaloutput./.
VNA
