THE United States-China trade war does not have a major impact on Malaysia’s trade performance with both countries, even though it has impacted the global economy.

The International Trade and Industry Ministry (Miti) said Malaysia’s total trade with the US in 2019 grew by 5.6% year-on-year (y-o-y) to RM164.45 billion; with exports rising by 5.5% to RM95.78 billion, and imports expanding by 5.7% to RM68.67 billion.

Meanwhile, Malaysia’s trade with China rose 0.2% to RM315.20 billion in 2019, with exports growing by 0.3% to RM139.61 billion and imports edging up by 0.1% to RM175.59 billion.

The ministry said Malaysia’s trade performance contracted slightly from January-June due to the Covid-19 pandemic, with total trade declining by as much as 7% to RM833.36 billion.

“Exports contracted by 6.8% y-o-y to RM448.99 billion and imports fell by 7.2% to RM384.38 billion, while trade surplus was 4.1% lower at RM64.61 billion,” it said in a written reply to Dr Ahmad Zahid Hamidi’s (Bagan Datuk-BN) question on the impact of the US-China trade war and Covid-19 pandemic on Malaysia’s imports and exports. 

Miti noted that there were several business opportunities in certain sectors, citing the substantial 40.3% increase in rubber glove exports, following the robust demand in the global market due to the Covid-19 pandemic. 

“Exports of medical devices such as test kits and disinfectants had also increased,” it said. 

Due to the ongoing US-China frictions and coronavirus outbreak, Miti said it had taken proactive steps through its trade promotion agency, Malaysia External Trade Development Corporation (Matrade) to address the trade impact on Malaysia. 

This includes focusing on the usage of digital technology to reduce the costs of promotion so that Malaysian exporting companies can stay competitive.

It said that between January 1-July 31 the eBizMatch business matching digital platform saw 576 business matchings, involving 395 foreign buyers and 538 Malaysian companies, registering RM461.35 million of potential sales.

Matrade has also expanded its Market Development Grant (MDG) to include virtual trade promotion activities. 

MDG has also allowed for the reimbursement of up to 30% of total logistic costs, including transportation and warehousing costs for the delivery of products overseas to alleviate the financial burden on Malaysian exporting companies due to the impact from the Covid-19 pandemic.

“From January 1-July 31, 1,427 applications from 962 companies were processed and a grant totalling RM14.56 million had been disbursed,” the ministry said.

It added that Matrade had also collaborated with the Malaysia Productivity Corporation and other relevant bodies to organise the Virtual Trade Clinic, a trade advisory service platform to assist companies in meeting the requirements and overcoming challenges in the exports markets. – Bernama, August 10, 2020.