Asia busi­nesses shelve in­vest­ment plans

The Star Malaysia - StarBiz - - Foreign News -

SIN­GA­PORE: US-China trade ten­sions are push­ing firms across Asia to de­lay or can­cel in­vest­ment de­ci­sions and ad­just their sup­ply chains, ac­cord­ing to the Amer­i­can Cham­ber of Com­merce in Sin­ga­pore.

Half of re­spon­dents said they were con­sid­er­ing putting on hold or scrap­ping in­vest­ment, ac­cord­ing to a sur­vey con­ducted Sept 27 to Oct 6 by AmCham Sin­ga­pore and Black­box Re­search.

About 38% are now look­ing to source com­po­nents out­side of China, while 30% are seek­ing al­ter­na­tives to US sup­pli­ers.

The data lend fresh in­sight to trends that have per­co­lated through­out the sec­ond half of 2018 as the world’s two big­gest economies ex­changed tar­iffs and pro­tec­tion­ist threats.

Firms re­sponded ahead of a meeting last week­end be­tween Pres­i­dents Don­ald Trump and Xi Jin­ping that yielded a frag­ile truce, putting on hold an in­crease in US tar­iffs that was planned for the start of 2019.

AmCham Sin­ga­pore’s re­sults re­leased Wed­nes­day were slightly starker than a re­cent poll by AmCham China and AmCham Shang­hai, which showed about one-third of the re­spon­dents were cur­tail­ing in­vest­ment.

The AmCham Sin­ga­pore sur­vey in­cor­po­rates data from 179 Sin­ga­pore-based re­spon­dents, with 63% be­ing Amer­i­can firms. About a quar­ter of re­spon­dents are in the man­u­fac­tur­ing in­dus­try.

About four in 10 re­spon­dents said their busi­ness was neg­a­tively af­fected by US-im­posed du­ties, with 35% re­port­ing the same for China’s tar­iffs dur­ing the first round of du­ties im­posed in July and Au­gust. About half said they ex­pected the much big­ger sec­ond round of tit-for-tat tar­iffs in Septem­ber to harm their busi­nesses, with US firms far more wor­ried (57%) ver­sus non-Amer­i­can firms (33%). — Bloomberg

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