KUALA LUMPUR, July 22 (NNN-BERNAMA) — American firms keen to establish their presence in Malaysia are likely to speed up their moves amid uncertainties caused by US-China trade tensions, says a trade body.
US-ASEAN Business Council (USABC) senior vice president and regional managing director Michael W Michalak said the supply chain shift has been going on for some time but the trade war has just accelerated that shift.
“I think that as you are going to see throughout today’s workshop that Industry 4.0 (IR4.0), the digital economy is going to be the centre of the economies going forward,” he said in a press conference here today.
It was held in conjunction with a one-day seminar organised by the Ministry of International Trade and Industry (MITI) and USABC themed “The Potential of Industry 4.0 for Malaysian Small and Medium Enterprises (SMEs)”.
Michalak also noted that Malaysia’s continuous effort to improve its regulatory environment would entice more companies to the country in the future.
Meanwhile, MITI Minister Datuk Darrel Leiking said the movement of foreign firms into Malaysia has been quite substantial.
“It is extremely important to us that we are able to provide them what they expect as well,” he said, noting that the IR4.0 environment has to be enhanced further in Malaysia so that we will become enticing to more of them.
“At the same time, the regulatory part of the government will also need to be looked at, so that when foreign companies come into Malaysia, they will be able to enjoy and have the facilities that they previously enjoyed but in a better way,” he said.
Big US companies are reportedly accelerating efforts to move more of their supply chains from China to emerging countries, including Malaysia.
Among these businesses are technology, clothing and footwear.
Since the beginning of the trade spat between the US and China, the business community has been trying to gauge the impact on trade patterns.
The US-China feud could potentially change the pattern of goods traded and bring more business to this part of the world.
Shipping experts had previously revealed that business firms would find ways to work around trade tariffs, import restrictions and trade embargoes to sustain their business.
“In terms of goods, products manufactured in China would be rerouted to neighbouring countries, get a different label and have their goods shipped to the US, if they find direct export too expensive,” the experts said.
US measures to address its trade imbalance have led some major corporations to fortify their North American operations and transfer some manufacturing capacity from China to any number of countries, including Malaysia, Vietnam, Cambodia, the Philippines, Bangladesh, India and Ethiopia.
–NNN-BERNAMA
