china, malaysia unite against tariffs, taiwan mention raises eyebrows

2025-04-17 general

Kuala Lumpur, Thursday, 17 April 2025.
china and malaysia have joined forces against tariffs. a joint statement was released. this statement included a controversial mention of taiwan. the move underscores the delicate geopolitical landscape. trade tensions continue to simmer. the semiconductor industry could be impacted. the statement reflects china’s ongoing efforts to assert its position. it also highlights malaysia’s balancing act between economic partnerships and political sensitivities. the mention of taiwan adds a layer of complexity. it signals china’s unwavering stance on the issue.

xi jinping’s visit to malaysia

Chinese President Xi Jinping’s recent state visit to Malaysia underscores a strategic effort to strengthen ties amidst global trade uncertainties [1][2]. During his visit, Xi met with Malaysian Prime Minister Anwar Ibrahim, expressing China’s willingness to collaborate with ASEAN countries to resist decoupling, supply chain disruptions, and the imposition of tariffs [1]. This visit, Xi’s first to Malaysia since 2013, signals China’s intent to be seen as a more reliable trade partner compared to the United States, especially given ongoing trade tensions and tariff disagreements [2].

joint statement details

The joint statement released by China and Malaysia contains 56 articles, addressing trade and关税 [1]. Both nations committed to promoting inclusive economic globalization and facilitating trade and investment [1]. They voiced opposition to the unilateral imposition of tariffs that violate WTO rules [1]. The statement reaffirms their commitment to a multilateral trade system that is rule-based, non-discriminatory, open, fair, inclusive, and transparent [1]. This united front against tariffs could influence investor sentiment, potentially bolstering confidence in companies operating within the region [alert! ‘specific companies not named’]

taiwan’s inclusion and investor concerns

The inclusion of a statement regarding Taiwan in the joint communique introduces a layer of geopolitical risk [1]. Malaysia reiterated its adherence to the ‘One China’ policy, acknowledging Taiwan as an integral part of China [1]. This stance could alienate some investors who view cross-strait relations as a significant factor in assessing regional stability and investment risk [GPT]. Any escalation of tensions related to Taiwan could negatively impact investor confidence and lead to market volatility in the semiconductor and related industries [alert! ‘no specific stock mentioned’]

malaysia as a key partner

Analysts view Malaysia as a crucial partner for China in Southeast Asia, given its population of 32 million, its developing high-tech infrastructure, and its current role as ASEAN chair [2]. China has been Malaysia’s largest trading partner since 2009, with trade reaching $212 billion in 2024 [2]. Strengthening trade relations with Malaysia could offset anticipated declines in exports to the U.S. [2]. Malaysia’s strategic importance within ASEAN also gives it influence in how other nations navigate China’s growing assertiveness in the region [2].

navigating trade dynamics and rcep

Amidst the challenges posed by U.S. tariff policies, Malaysian experts advocate for deeper bilateral cooperation and enhanced regional cooperation mechanisms [6]. Professor Sufian Jusoh from the National University of Malaysia emphasizes the potential benefits of the Regional Comprehensive Economic Partnership (RCEP) and the upgraded ASEAN-China Free Trade Area [6]. These agreements can facilitate more resilient supply chains through reduced or zero tariffs, enhancing economic and trade cooperation within the region [6]. RCEP encompasses 30% of the world’s population, offering substantial economic opportunities [7].

potential impact on gdp

However, the uncertainty surrounding U.S. tariffs continues to pose a threat to Malaysia’s economic growth [5]. Public IB analyst Eltricia Foong suggests that ongoing tariff uncertainties could strain the Malaysian economy, particularly through supply chain disruptions and reduced external demand [5]. Foong revised Malaysia’s 2025 GDP forecast from 4.9% to 4.2%, citing trade risks and market volatility [5]. Public IB maintains its end-2025 target for the Malaysia KLCI index at 1630 points [5]. Investors should closely monitor these macroeconomic indicators [GPT].

Bronnen

trade relations geopolitical risk