LOCAL businesses have urged Putrajaya to look into ways to boost trade between Malaysia and China, as Covid-19 is expected to dampen bilateral trade.

China is Malaysia’s largest trading partner for 11 consecutive years. Malaysia’s trade with China stood at RM315.19 billion in 2019, accounting for 17.2% of the total trade.

According to data from Matrade, Malaysia’s trade with China declined by a marginal 1.5% in April 2020, as Malaysia recorded its first monthly trade deficit since October 1997.

Malaysia-China Chamber of Commerce (MCCC) president Tan Yew Sing expects the full year bilateral trade volume between the two countries to be lower this year after a softer first half due to Covid-19.

However, trading activities are expected to pick up in the second half of the year.

Covid-19, which has affected about 180 countries, has forced nations to take serious measures to break the chain of infection, which includes sealing off borders and denying entry to foreigners.

Tan said Malaysia can emulate Singapore and China’s fast-lane measures, which allow essential and official travel between Singapore and six provinces in China.

“Malaysia-China trade and economic growth has been increasing over the years.

“I hope that the Malaysian government can discuss with China on handling trade and economic activities and facilitate Malaysian businesses to do business with China,” Tan told The Malaysian Insight.

“What I am saying here is that the government can implement safety measures.

“Perhaps there could be a step-by-step opening up of the business sector similar to the transition from the movement control order (MCO) to the conditional movement control order (CMCO) and the recovery movement control order (RMCO.”

The manufacturing industry is forced to look to markets outside China to source raw materials, he said.

“The outbreak which began early this year has slowed down trade between China and Malaysia for several months.

“I believe that after this experience, many companies will learn how to prepare for recovery in the second half of the year and tap into business opportunities, especially those springing from the US-China trade war.”

Local companies, he said, should also look into adopting advanced technology to attract investment.

Turning to e-commerce

Tan also said because of the outbreak, many businesses in Malaysia and China have adopted e-commerce, forcing businesses to relook at the way things are done, including virtual meetings and others.

The chamber itself was initially slated to hold a Malaysian-Chinese entrepreneurs’ conference in October, which will now be held virtually.

Entrepreneurs are slowly getting used to conducting business online.

Yee Lee Corp Bhd turned to e-commerce after operations slowed down because of Covid-19.

Its founder and executive chairman, Lim Kok Cheong, who has a footprint in China for years, said this allowed more businesses to turn to e-commerce.

“Our company produces edible oil and mineral water, which are necessities.

“Therefore, it is still in operation during the movement restrictions period. People’s movement is limited and business is slow. The sales volume will be less.”

The company is stepping up online sales in China and its business units in Malaysia and China are using online platforms to do sales.

Lim said being a conservative businessman, he had to adopt new technology.

Former ACCCIM president Lim Kok Cheong said small and medium enterprises are affected by the pandemic.

Except for those in the medical and telecommunications sector, most SMEs have been impacted.

“I am lucky to run a cooking oil and water business. After this epidemic, companies must understand how to plan ahead and reserve cash flow. When the market is good, they will thrive and when the market is bad, they will be wiped out.”

In the wake of Covid-19, companies will need to learn new technologies and business models.

“The government also plays an important role in creating a friendly business environment for Malaysian and Chinese businesses to attract foreign investment,” he said. – July 1, 2020.