Govt hopes US-China trade deal signed at APEC 2020

pic by AFP

MALAYSIA hopes that the US-China interim trade deal, slated for agreement this month, can be sealed at the Asia-Pacific Economic Cooperation (APEC) 2020 summit, said International Trade and Industry Minister Datuk Darell Leiking.

“As chairman, the country will hold the conference next year, which will be attended by both presidents of the US and China. Malaysia expects the APEC Conference to serve as a platform for the two major economies and other countries to cooperate, especially in the field of economics.

“I hope that APEC 2020 with the theme ‘Optimising Human Potential Towards a Future of Shared Prosperity’ will also contribute to regional economic wellbeing, and will indirectly resolve trade conflicts between the US and China,” Darell told the Dewan Rakyat yesterday.

He said this in response to Datuk Halimah Mohamed Sadique (Barisan Nasional-Kota Tinggi), who asked the minister’s view on the rivalry between the two superpowers which has prolonged for two years now.

Both the US and China were scheduled to sign an interim trade deal during the Nov 16-17 APEC summit in Chile. Chilean officials, however, cancelled the summit amid anti-government protests in the country.

The White House stated afterwards that the US still expected to sign an initial trade agreement with China in December, but no alternate location had yet been set for the two presidents.

Foreign Affairs Minister Datuk Seri Saifuddin Abdullah had previously revealed that US officials had, during the 35th Asean Summit in Bangkok recently, sought for Malaysia’s position on Washington’s proposal to host a substitute summit, to which Malaysia responded negatively.

The US-China trade war has had a major impact on countries given their principal role in the global value chain. Nevertheless, Malaysia can gain from the trade crisis via investment diversion or relocation by US and Chinese multinationals to the country.

Between January and June this year, investments from the US recorded the highest amount of foreign direct investment (FDI) in Malaysia with 19 approved manufacturing projects worth RM11.7 billion — creating over 3,200 jobs.

Meanwhile, bilateral trade between Malaysia and the US from January to August 2019, continued to show a growth of 4.9% to reach RM106.48 billion against the same period in 2018.

China, on the other hand, is Malaysia’s second-largest source of FDI for the first six months this year, with a total investment value of RM4.8 billion from 30 approved projects. These investments are expected to create 4,238 job opportunities in various sectors.

Average trade between Malaysia and China for the January-August period this year declined by 1.2% to RM203.73 billion from last year on declines in export of electrical and electronic goods, rubber production, crude petroleum and optical goods.

However, exports for liquefied natural gas, chemicals, iron, steel and metal goods showed an increase. Imports from China registered a 2% drop to RM114.77 billion over the same period.