The Borneo Post (Sabah)

Malaysia may be affected by US-China friction — Standard Chartered

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KUALA LUMPUR: Malaysia is likely to be affected by the ongoing US-China trade war should the friction intensify towards the end of the year, said Standard Chartered Bank.

Its Chief Economist for ASEAN and South Asia, Edward Lee, said the impact could be cushioned by investors’ confidence in Malaysia, with a stream of new investment­s committed by businesses who were seeking an alternativ­e production base.

“Malaysia’s growth will be affected directly and indirectly, but I am not sure whether this will be by the end of the year. Probably we will see a clearer picture in early 2019,” he told reporters after a global research briefing for the second half of 2018 here yesterday.

Standard Chartered Head for Asean and South-Asia FX Research, Divya Devesh, and Head of Thematic Research. Madhur Jha, were also present.

“I think that (the trade war) has affected especially investment sentiment in Asia. This is quite clear on two things. One is it seems really to be targeted against China and second, and more worrying for me, is this may be more of a long-term issue. Trade is just one of the factors that we are looking at,” said Lee.

The bank has lowered its forecast for Malaysia’s gross domestic product in 2018 to 4.8 per cent from its earlier estimate of 5.3 per cent due to the US-China trade war and weaker-than-expected economic growth in the first half of the year.

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