By Mohd Khairul Ramli
A second term of Donald Trump presidency could have significant implications for in global trade, influencing trade dynamics, economic policy, and regional geopolitics. For Malaysia, a Trump victory would signal both opportunities and challenges, primarily in the arenas of trade, economic sustainability, and geopolitical alignment could potentially reinvigorate his nationalist economic policies. This might cause disruptive ripple effects in Malaysia’s economic corridors, impacting its trade flows, and redefining Malaysia’s role on the world stage. While some aspects of his presidency may present strategic openings, others could spell increased volatility in an already delicate global landscape.
Economic Nationalism and What It Means for Malaysia’s Future
A hallmark of Trump’s economic approach, economic nationalism under the “America First” doctrine, often sees foreign partners bearing the costs of U.S. domestic priorities. Should tariffs return in force, as many anticipate, Malaysia’s export-driven economy could be adversely affected. As a manufacturing hub, Malaysia has deep trade ties with the U.S. that encompass key industries like electronics, machinery, and palm oil. During Trump’s first term, his tariff policies primarily targeted China, creating indirect opportunities for Malaysia to fill trade gaps in the U.S. supply chain. However, with Trump’s focus on repatriating manufacturing and reducing dependency on foreign imports, Malaysian industries may face scrutiny or tariffs, making exports less competitive in a high-demand American market.
Moreover, a “tariff arms race” could again strain Malaysia’s regional supply chains. If Trump pursues bilateral over multilateral agreements, Malaysia may face the dual task of negotiating individual terms while navigating the fallout of strained U.S.-China relations. The U.S. stance under Trump on the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) remains critical; though he exited the original TPP, a return to an aggressively protective stance could diminish the CPTPP’s value and complicate Malaysia’s trade advantages under it. However, if Trump aligns with other Southeast Asian nations on countering China’s influence, Malaysia might see some strategic alignments, though likely accompanied by heightened expectations from the U.S. side.