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Trump’s invitation to the prime minister to visit the White House is a clear triumph for Najib

Politicians regularly trade favours: It is a game all of them play at some point. But what happens when the favours only seem to be going one way?

US President Donald Trump’s invitation to Prime Minister Datuk Seri Mohd Najib Razak to visit the White House is a clear triumph for Najib.

Not only does it enhance the prime minister’s prestige, it also gives him the opportunity to come to some sort of understanding with the American leader regarding the US attorney general’s investigation into allegations of corruption regarding 1Malaysia Development Bhd (1MDB).

It may even accord the prime minister the opportunity to counter local criticisms that he has moved too close to Beijing in the wake of recent publicity regarding China’s huge investments in the country.

But Najib may not get everything he wants.

According to diplomats, the invitation to visit the White House is an expression of appreciation for Malaysia’s determination to dismantle the financial infrastructure of private North Korean firms within Malaysia’s borders and ensure that the country’s ports are not used as transit points for military equipment.

The assurance is important to Washington, which has long suspected that Malaysia is a favoured location for North Korean agents and their proxies to hold secret meetings and generate foreign currency.

Even so, it is not often that the heads of foreign governments get the opportunity to meet with a US president. The fact that the two men appear to get along well may also have had something to do with Trump’s willingness to issue the invitation. Sometimes described as the president’s “golfing buddy”, Najib is the proud owner of a picture of himself and Trump signed by the president with the words, “To my favourite prime minister” inscribed on the back.

Malaysia a Trade Cheat?

The invitation, however, may well be as far as Trump is willing to go when it comes to issuing favours.

This is because apart from that almost inevitable chat about 1MDB, one of the key topics set for discussion is likely to be bilateral trade flows.

In a March executive order, Trump directed the US Department of Commerce to investigate 16 countries — including Malaysia — that have been enjoying a trade surplus due to unfair trade.

Malaysia denies the charge. “Cheating means selling below market prices, and we have not done that,” International Trade and Industry Minister Datuk Seri Mustapa Mohamed told the media last month, adding that “we have to explain the situation, so the US will have a clearer understanding of the numbers”.

But will Trump be prepared to listen?

In seeking an answer, it is important to remember just how far apart the two men are when it comes to economic policy.

Najib favours free trade, and has expended a considerable amount of political capital raising revenue through unpopular taxes.

Trump sees free trade agreements as deeply flawed, and is on record as wanting to reduce taxes.

Both have doggedly pursued their respective economic agendas regardless of the condemnations hurled at them by their political opponents.

Having declared his intention not to proceed with the Trans-Pacific Partnership Agreement (TPPA) concluded by his predecessor, Trump is unlikely to make trade concessions to one of the TPPA’s most enthusiastic supporters.

Trump’s Political Calculations

Inviting Najib to Washington is easy for the US leader.

Liberal newspapers in the US may describe the visit as a setback for the rule of law, but their readers are critical of the US president anyway. No harm done there.

As for Trump’s white working class supporters, they are unlikely to know much about Malaysia’s political controversies. And they probably care even less.

Ask these same supporters about unfair trade practices, however, and they will almost certainly express strong opinions.

Encouraged by Trump, they blame a variety of free trade agreements for the loss of jobs in the US as companies move their operations to lower-cost locations.

Moreover, these voters are being reminded about the issue almost every day, with reports about Trump’s impending moves against China regularly in the news.

Under Section 301 of the 1974 US Trade Act, the president can unilaterally impose tariffs or other trade restrictions in order to protect US industries from the “unfair trade practices” of foreign countries.

These include trade agreement violations or other actions that have a negative impact on US commerce.

The legislation was used frequently in the 1980s to target Japanese imports of motorcycles, steel and other products.

Trade Issues

One issue likely to be debated when Trump and Najib meet, is the size of Malaysia’s trade surplus with the US.

Washington said this surplus amounts to around US$25 billion (RM105 billion), whereas Kuala Lumpur maintains that the real figure is closer to US$6 billion.

Yet another issue of concern in the US is the persistently weak ringgit, something the Malaysian government can fairly claim not to be responsible for. “We do not manipulate our currency,” Mustapa told journalists in April.

Moreover, the Malaysian government “does not provide assistance (to businesses) that go against international laws, such as the ones laid down by the World Trade Organisation”.

The minister added that he had instructed his ministry to explain and correct the accusation.

Given their vastly different approaches to economic policy, however, Trump and Najib are unlikely to see eye to eye. Najibnomics and Trumponomics come from different worlds.

Najib may quote all the statistics he likes in support of Malaysia’s case, but Trump’s track record since becoming president suggests that the US leader may not be willing to allow a few inconvenient facts get in the way of a good opinion.

That said, Trump has reversed his positions on so many issues since becoming president in January that Najib may yet be able to convince the US leader to add Malaysia to the list.

Najib’s recent successes in drawing in major investments from China and India certainly suggests a high level of skill when dealing with the heads of foreign governments.

• Dr Bruce Gale is an expert on South-East Asian affairs and author of several books on the subject. He was the regional manager for Hong Kong-based Political and Economic Risk Consulting and is currently based in Singapore.