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Showing posts with label Geopolitics. Show all posts
Showing posts with label Geopolitics. Show all posts

Sunday, August 3, 2025

US revises tariff rate to 19%

 

 However, nation must urgently diversify its export destinations

PETALING JAYA: Malaysia’s revised tariff rate of 19% on exports to the United States offers a temporary competitive edge in the region but underscores the urgency for export diversification amid signs of growing US protectionism, economists warn.

Prof Emeritus Dr Barjoyai Bardai said the revised rate, down from 25% previously, positions Malaysia on par with neighbou­ring countries such as Thailand, Indonesia, Cambodia and the Philippines.

ALSO READ: Malaysian industries can breathe easier now

He said the rate is still more favourable than those imposed on Myanmar (40%), Vietnam (20%) and Taiwan (20%).

“We seem to be able to compete with our neighbouring countries. But we are far behind Singapore at 10%, as well as Japan and South Korea at 15%.

“With India at 25%, we are in a better position,” he said when contacted. What we really want to see is that the tariff imposed on Malaysia is as low or better than that of countries that are our competitors because we are exporting to the United States.

“So, if those countries have equal or higher tariffs than us, then our ability to compete remains intact,” he added.

However, he said that certain Malaysian exports may be vulnerable, especially low-­margin products such as solar panels, and electrical and electronic goods.

On the trade balance with the US, he said it depends on whether Malaysian imports from the US increase significantly, especially luxury goods, following the government’s decision to scrap the luxury tax.

“Although the luxury tax has been included in the expanded SST, the rate is still low,” he added.

He said Malaysia must urgently diversify its export destinations, as the US moves towards a more self-sufficient economy.

Barjoyai said semiconductors should be directed to countries with growing demand, such as China, India and Europe.

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For other items like solar panels, he said Malaysia should consider Latin America, Canada and Europe.

“There are still many untapped markets. In the long run, the United States will become a domestic-driven economy where they will seek to reduce imports.

“Today, they are already about 80% self-sustaining,” he added.

Echoing similar concerns, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the tariff adjustment signals that the United States remains open to dialogue, but the economic implications for Malaysia remain.

“As a result of recent discussions, the previously imposed retaliatory tariffs of 25% have now been reduced to 19%.

“Consequently, the negative impact on Malaysia’s economy is expected to be slightly mitigated.

“In this regard, Bank Negara has revised its GDP forecast for 2025 to a range of 4.0% to 4.8%, down from the earlier projection of 4.5% to 5.5%,” he said.

Afzanizam also highlighted the potential global impact of US ta­riffs.

“The 19% import tariff is expected to impact American consumers’ purchasing power.

“This may, in turn, dampen economic momentum in the US, which is the world’s largest econo­my. It poses a potential risk to glo­bal economic growth in the coming years,” Afzanizam said.

He also called for a balanced approach to foreign relations and economic strategy.

“It is crucial to preserve strong bilateral ties with the United States, while simultaneously exploring new opportunities with countries in Europe, the BRICS bloc, and strengthening economic and diplomatic cooperation within Asean.

“At the same time, efforts to boost productivity, build capacity and enhance economic resilience must be intensified to safeguard Malaysia’s economic sovereignty.

“These measures will reinforce investor and business confidence, underpinned by pragmatic policies and the government’s proactive response to emerging challenges,” he added.

Centre for Market Education chief executive officer Carmelo Ferlito, meanwhile, said the tariff revision reflects a political strategy rather than a pure economic measure.

“The reciprocal tariff on Malay­sia to 19% is the proof of what I have mentioned earlier,” he said, adding that US President Donald Trump was not interested in ta­riffs per se, but to reopen negotiating tables.

He said this is to show that the United States is the biggest consumer in the world and force countries to get closer to the United States as well as grant commercial facilitations.

Ferlito criticised the use of ta­riffs as a policy tool, arguing that they hurt both consumers and workers.

“Tariffs are bad, not just for Malaysia, but for the world,” he said, adding that ultimately, ta­riffs reduce trade opportunities.

“This means less choice for consumers, but also job losses, on both sides,” he added.

Tuesday, July 8, 2025

Why the cooperative spirit of ‘greater BRICS’ resonates worldwide



The 17th BRICS Summit is being held from July 6 to 7 in Rio de Janeiro, Brazil. This marks the first high-profile gathering of the "greater BRICS family" in its new "11+10" format - comprising 11 member countries and 10 partner countries - following Indonesia's official entry into the BRICS cooperation mechanism in January and Vietnam's official joining as a BRICS partner country in June. The summit is themed "Strengthening Global South Cooperation for More Inclusive and Sustainable Governance." As the host country, Brazil has outlined three key priorities for the meeting: deepening cooperation in public health, promoting a unified stance on climate change, and establishing mechanisms to facilitate trade and investment among member states.


On the eve of the summit, Colombia and Uzbekistan formally joined the New Development Bank as full members. Today, the BRICS family represents over half of the world's population, accounts for one-fifth of global trade, and contributes nearly 30 percent of global GDP. This remarkable momentum is no accident - it reflects the growing appeal of the "BRICS spirit" of openness, inclusiveness, and win-win cooperation. According to data from the International Monetary Fund (IMF), in 2024, BRICS collectively reached 4 percent GDP growth, significantly outpacing the global average. This demonstrates that the "greater BRICS" has become a "southern engine" that continuously fuels global development.

According to some foreign media outlets, this year's summit will discuss important topics, including the establishment of a new guarantee fund and the "Tropical Forests Forever Facility," and will voice collective positions on IMF reform. As the world is entering a new period of turbulence and transformation, characterized by rising unilateralism and protectionism, and some major powers increasingly disengaging from international governance, BRICS remains steadfast in its original aspiration, focusing squarely on cooperation and development. All its agendas and agreements are being gradually implemented, turning words on paper into real development outcomes. As of 2024, the BRICS New Development Bank has approved 120 projects worth a total of $39 billion, covering key sectors such as transport infrastructure, clean energy, healthcare, and social development. As the "vanguard of the Global South," the "greater BRICS" governance proposals are receiving global attention, and the world is looking to the "greater BRICS" for wisdom and contributions.

The growing influence of the "Greater BRICS" is evident in Western reporting. From the very start, the Rio BRICS Summit has become a focal point of global attention. Reuters noted that the expansion of the "Greater BRICS" "has added diplomatic weight to the gathering" and the bloc is presented "as a defender of multilateralism in an increasingly fractured world." The New York Times focused on the new role of "BRICS" in global governance, emphasizing its ambition to "rebalance global power dynamics." Although some media outlets maintain a "critical" and "skeptical" attitude toward the BRICS Summit, the inherent "traffic appeal" of the Rio Summit is enough to reflect the international community's attention to and recognition of BRICS.

The BRICS countries differ in terms of historical culture, political systems, economic size, and development levels, and there are differences between overall interests and individual interests. However, this precisely reflects the valuable inclusiveness and complementarity of the BRICS mechanism. BRICS cooperation is a systematic collaboration of the Global South; it is both comprehensive cooperation and open-door cooperation. It embodies the voices of the Global South, providing more development opportunities and equal rights for countries in the Global South, and promoting an equal and orderly multipolar world as well as a universally beneficial and inclusive economic globalization. This not only aligns with the interests of the Global South but also contributes to the common good of the world.

From promoting the establishment of the New Development Bank to advocating for the "BRICS+" cooperation model; from articulating the "four major partnerships" among BRICS countries to building new industrial revolution partnerships within BRICS, China's contributions to the BRICS mechanism are evident. According to the "Hand in Hand: China-LAC Mutual Perception Survey," released by the Global Times Institute during the "Global Times' Overseas China Week and Global South Dialogue" series of events held in Latin America in late June, a majority of respondents from six Latin American countries believe that the BRICS can represent the Global South to voice its concerns on the international stage. Furthermore, 93 percent of Latin American respondents believe that China has brought opportunities for development to the region, and 84 percent recognize China's development prospects. Through its own actions, China has built a bridge of hope for common development, making the gears of "greater BRICS" cooperation operate more smoothly.

IIn the face of the ever-changing international landscape, BRICS countries have demonstrated strong cohesion and action, providing a "BRICS answer" to the changes unseen in a century, which enhances the credibility of BRICS. The Rio Summit will mark a new starting point. Looking ahead, BRICS countries will continue to uphold the "BRICS spirit," deepen cooperation in various fields, promote reforms in the global governance system, and make greater contributions to world peace and development.- Global Times

Related:

BRICS: not against anything, but for development, fairness and Global South

BRICS is not “against” anything; it is “for”: for the development, for a fairer world order, and a larger role for the Global South. It concentrates on specific development problems, which makes BRICS very attractive to other developing


Monday, June 16, 2025

Over half of Australians believe China will be most powerful country by 2035: poll

 

Photo: screenshot from the Lowy Institute Poll


A new Australian poll has found that more than half of Australians (56%) believe China will be the most powerful country in ten years, while only about a quarter (27%) say the same of the US, noting "attitudes toward China improved incrementally, but caution remains." 

Similarly, more believe China (58%) will lead technologically in ten years compared to the US (12%), according to Lowy Institute Poll 2025 Report published on Monday

This reflected a positive shift on Australian perceptions of China with growing number of Australians gaining firsthand exposure to China's realities, a Chinese expert commented on Monday. The expert hopes in developing bilateral ties, Canberra would not be hijacked by external forces, stressing "the common ground far outweighs differences, and bilateral relations must be defined by cooperation, not divisions."

Attitudes towards China improved incrementally, but caution remains, the Australian institute said in the summary of the poll. The poll reports the results of a nationally representative survey of 2117 adult Australian residents, conducted between 3 and 16 March. 

For the first time since 2020, Australians were just as likely to see China as an economic partner than as a security threat - though a clear majority (69%) continue to think it likely China will become a "military threat" to Australia in the next 20 years, according to the poll.

About half think Australia should cooperate more with China on climate change (49%). Views on economic engagement are mixed — a plurality (43%) say Australia should be trading at about the same level as now, whereas about half (49%) say Australia should be attracting less investment from China, shows the poll.

Regarding Australia's relationships with the superpowers, a bare majority continue to say the US is more important to Australia (52%), while a lower proportion prioritize China (43%), the poll shows.

Australian Prime Minister Anthony Albanese (45%) enjoyed a 20-point lead over Peter Dutton (25%) in Australians' confidence in him to manage the relationship with China, according to the poll.

"There's slightly more trust, slightly less threat perceptions, [but] it's still a pretty bleak picture for how Australians look at China," The Guardian quoted Ryan Neelam, the poll author and a director at the Lowy Institute, as saying.

Since the 2024 survey, the gap between Australians' trust in the US compared with China has more than halved, as perceptions of China continued to improve from their nadir in 2022, The Guardian reported, quoting Neelam.

Commenting over the poll results, Chen Hong, director of the Australian Studies Center at East China Normal University, told the Global Times on Monday that in previous years, under the influence of the then-ruling party's political maneuvers and the deliberate smear campaigns by certain anti-China forces in Australia's media landscape, public perceptions of China had been distorted and mired in so-called "China threat" narratives. This led to notably negative attitudes in polls, such as the Lowy Institute Poll 2022 Report.

However, facts speak louder than rhetoric, Chen continued. Recent years have seen growing number of Australians gaining firsthand exposure to China's realities, particularly after China's visa-waiver policy for Australians, Chen said.

"For instance, we've recently hosted multiple delegations from Australia and New Zealand, with more set to visit," Chen said, sharing his experience. "The latest poll reflects a more objective shift in public sentiment," Chen noted.

Yet while Australians increasingly recognize these truths, the persistence of a majority (69%) viewing China as a future "military threat" reveals the lingering impact of fabricated "China threat" narratives, Chen remarked. 

In addition, according the Australian poll, just over one in three Australians (36%) trusted the US to act responsibly in the world, a 20-point drop since last year and the lowest level on record since the Lowy Institute began polling in 2005.

Despite the sharp drop in trust towards the US, more than six in ten (63%) continue to think that the US would come to Australia's defense if it were attacked, and more Australians say the country should remain close to the US (57%) than those who think Australia should distance itself from its major ally (40%), said the poll.

Nevertheless, most Australians (68%) are pessimistic about the current US administration. Australians are evenly split on Washington's demand for US allies to spend more on defense, according to the poll.

Since the 2024 survey, the gap between Australians' trust in the US compared with China has more than halved, as perceptions of China continued to improve from their nadir in 2022, The Guardian reported, quoting Neelam.

According to The Guardian, Neelam said "That's quite remarkable for Australia's key security ally to have such a low level of trust." "The weight of expectation is that China will be more powerful and more predominant in the global system," he said.

Support for the AUKUS nuclear-powered submarine deal remained steady, with two-thirds of Australians (67%) in favor—roughly unchanged from 2022 (70%), shortly after AUKUS was announced.

As the US consistently prioritizes its own interests and national security, even at the expense of allies, a stance that has fueled growing public disillusionment in Australia, Chen pointed out.

But the expert, citing the poll showing 63% of Australians still believe the US would defend Australia if attacked, said this exposes a lingering, unrealistic idealization of American commitments.

Friday, May 30, 2025

ASEAN-China-GCC Summit in Malaysia sets an example for global cross-regional cooperation

 Chinese Premier Li Qiang gives his opening remarks during the ASEAN-GCC-China Summit at the Kuala Lumpur Convention Center in Malaysia on 27 May, 2025. Photo: AFP


The successful convening of the ASEAN-China-GCC Summit in Malaysia has been widely recognized as a "landmark" event of major significance. The Joint Statement of the ASEAN-China-GCC Summit adopted at the summit marks the transition of cooperation among the parties from concept to reality. This summit not only showcased the surging momentum of Global South solidarity but also expanded the horizon of cross-regional cooperation and inter-civilizational integration. The three parties view their differences as opportunities for cooperation and promote development through unity, which not only responds to the common aspirations of Global South countries but also provides a new model of cooperation for the world.

The fruitful outcomes of the first trilateral summit are clearly reflected in the Joint Statement of the ASEAN-China-GCC Summit. In the economic area, the three sides agreed to leverage their complementarities to strengthen collaboration in the fields such as trade, investment and finance, promote economic integration, and enhance industrial and supply chain resilience. In promoting the de-escalation of regional tensions, the three parties jointly called on all sides involved in Middle East conflicts to refrain from targeting civilians and to uphold international humanitarian law, thereby laying a cornerstone for regional peace and stability. The three sides will also deepen cooperation in cultural exchanges, energy security and sustainability, as well as digital transformation and innovation. In addition, to further facilitate the movement of people between China and other countries, China has decided to expand its visa-free policy, now covering all GCC member states. With the implementation of the aforementioned outcomes, trilateral cooperation will surely advance to a higher level, broader areas, and deeper dimensions.

Beyond bringing certainty to the region and the world, the trilateral cooperation holds a deeper and more unique significance. 

It transcends the once-popular notion of a so-called "clash of civilizations" by transforming differences in cultural traditions and stages of development into powerful drivers of complementary collaboration. This, in turn, unveils a new chapter of mutual learning among human civilizations.

If viewed through the lens of bloc confrontation, the trilateral cooperation would be seen as friction among different religions and as a geopolitical tug-of-war forcing countries to take sides. However, from the perspective of a "shared future," what emerges is something entirely different: the GCC with its vast energy reserves and multi-trillion-dollar sovereign wealth funds; ASEAN's manufacturing strength and its emerging consumer market of nearly 700 million people; and China's formidable industrial capacity, technological innovation, and infrastructure-building expertise. Together, these elements signal enormous development potential and ample room for win-win cooperation. As one Qatari economic expert observed, "Everyone will benefit from this historic summit."

China, ASEAN, and GCC countries together account for roughly a quarter of the world's population and global economic output. The groundbreaking cooperation among the three parties sends a clear message to the world: Unity and joint development are not distant dreams but a tangible path already unfolding. This cooperation is not a "victory" for any one side, but an epitome of peace and development, cooperation and mutual benefit. In the face of the increasingly severe realities of global deficits in peace, development, and trust, the trilateral summit has injected new vitality into the maintenance and practice of multilateralism. 

In the future, countries in the Global South, such as those in Africa, Latin America, and beyond, can certainly envision a richer imagination in building a comprehensive cross-regional cooperation network and achieving open and inclusive development.

In this "big triangle," China is both a participant and a supporter, injecting new momentum into tripartite cooperation through its own high-quality development. Whether from China's economic data or the global capital rush to invest in China, it is evident that the Chinese economy, having weathered storms, has become deeper, richer, and more inclusive. This stability, certainty, and inclusiveness provide a solid foundation for the international community, including ASEAN and GCC countries, to trust and invest in China. 

The recent announcement of the completion of the negotiations on the Version 3.0 China-ASEAN Free Trade Area has fostered more positive expectations regarding China's completion of free trade agreement negotiations with the GCC. It is believed that with the enhancement of trilateral trade levels, China, ASEAN, and GCC countries will all further benefit from open cooperation.

Just as President Xi Jinping said, "For us to break through the mist and embrace a bright future, the biggest strength comes from cooperation and the most effective way is through solidarity." This "1+1+1" cooperation model among China, ASEAN, and the GCC is a concentrated embodiment of this spirit. It not only benefits each individual party but also contributes to a greater overall increment for Asia and the world as a whole. 

It is believed that the three parties will unite to generate tremendous strength, bringing a more prosperous and stable development outlook for the region and the world, injecting continuous positive energy into the cause of world peace and development, and providing lasting momentum for the building of a community with a shared future for mankind. -Global Times

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Sunday, May 25, 2025

How Asean can ease the birth pains of the multipolar world

 

Power shift: Asean has a big opportunity this week to help usher in the new world order. — Bernama

ON April 2, US President Donald Trump smashed the World Trade Organisation’s system of multilateral trade by announcing the imposition of tariffs, starting at midnight on April 9, on imports from “cheater” countries that were engaging in unfair trade practice. To Trump, a cheater is one that exports more goods to the United States than it imports.

This is nonsensical reasoning. A bilateral trade deficit is not evidence of being “cheated” because the payment to my barber does not mean that I have been cheated and my salary does not imply that my employer has been bamboozled. This nonsense shows that the tariff war is only marginally related to unfair trade practices. The two key reasons for the tariffs are to increase wages by bringing manufacturing jobs back to America and to cement US primacy in the global order with a show of force.

Tragically, the tariffs will neither revive manufacturing nor preserve US primacy. Tariffs will temporarily expand employment in a few sunset industries, but wages will remain stagnant because productivity growth potential in those sectors is nonexistent.

The immediate response to Trump’s show of force were precipitous collapses in the prices of US stocks and bonds, and the value of the US dollar. Investors recognised that this Great Wall of Tariffs had isolated the US economy, inevitably impoverishing it. Hence, 13 hours after the tariffs came into force, Trump suspended them for every trading partner except China. This climbdown made clear that the real target is China, which the US perceives to be an unfriendly power (eg, being friendly to Iran) that is engaging in unfair trading practices (eg piracy of US technologies).

The economist Adam Smith had anticipated this kind of clash in 1776. He observed that the three centuries of globalisation that began with the discovery of the Americas in 1492 and the discovery of the sea route from Europe to India in 1498 had overwhelmingly benefited Europe because its much greater military might enabled it to pillage instead of trade.

Smith, however, foresaw a reversal: the diffusion of technology through trade would eventually narrow the gap between the two groups. The economic rise of Japan, South Korea, China, and India is ushering in today’s messy transition from a unipolar to a multipolar order.

Asean should be guided by two understandings in navigating this transition.

The first is that the current US-China confrontation stems from their shared recognition that the prevention of war would require an eventual agreement on their respective spheres of influence. We are witnessing a defensive race between them to expand their spheres of influence, which is why the US has asserted its rights over Canada, Greenland, Panama, and Gaza; and China’s nine-dash line in the South China Sea has brought its maritime border to the doorstep of several Asean nations.

States that lock themselves into Washington’s orbit will be under strong pressure to decouple from Chinese technology and to shrink commercial ties with the world’s largest trader – sacrificing not only today’s access to the Chinese market (prospectively, tomorrow’s access to India) and compromising their sovereignty.

The second understanding is that this transition has created systemic dangers that require institutional responses. These new dangers include the Thucydides Trap which is the risk of war between rising and established powers; the Kindleberger Trap where inadequate international cooperation leads to ineffective handling of global disasters like climate change; and the Tragedy of the Commons which identifies the coming collapse of the food chain.

The Cold War 2.0 is causing growing collateral damage to Asean. A viable alternative to membership by Asean states in one of the spheres of influence is for Asean to cooperate with other middle power countries to form a nonpartisan club that functions as a buffer zone between the spheres of influence.

It is crucial for this club to achieve critical mass quickly – being big enough in population and GDP to earn begrudging acceptance by Washington, Beijing, and Moscow for its right to remain a neutral force. To achieve critical mass quickly, the founding group of countries must be kept to a manageable number to ease negotiations.

Asean must avoid instinctively shaping a Global South response like convening a new Bandung Conference (which brought together 29 newly independent Asian and African countries in 1955). The goal is not to accentuate class warfare at the international level but to maintain economic globalisation, world peace, and environmental sustainability.

To achieve critical mass quickly, this club must also bridge the Global South and the Global North. After establishing deep cooperation among Asean, Japan and South Korea (thereby setting the tone of North-South cooperation), this Asian grouping should propose to the European Union and United Kingdom the formation of the Atlantic-Pacific Sustainability Partnership (APSP).

The APSP would serve three core functions: (a) defend economic globalisation with a free trade area based on open regionalism; (b) defend global peace and environmental sustainability with a sustainability caucus to reduce tensions among major powers and coordinate actions on common challenges like pandemics; and (c) defend mutual aid with a development assistance agency guided by the 17 United Nation’s Sustainable Development Goals (SDGs) to counterbalance the use of development aid by major powers as a means of political influence.

Given the accelerated growth of Asean under this new system, the economic weight of the APSP would be more than twice that of China or the US by 2045, making it necessary for US and China to join the APSP to avoid defeat through self-marginalisation.

When this happens, the APSP would have crowded out Cold War 2.0 with cooperative multilateralism.- by  Prof Datuk Dr Woo Wing Thye

Renowned economist Prof Datuk Dr Woo Wing Thye is a visiting professor at Universiti Malaya and research professor at Sunway University. He is also Professor Emeritus of Economics at the University of California, Davis; University Chair Professor at Liaoning University; and Distinguished Fellow at the Penang Institute. 

The views expressed here are solely the writer’s own.

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