KUALA LUMPUR (Dec 19): China can buy more from Malaysia, especially palm oil, to narrow the trade gap between both countries, says Finance Minister Lim Guan Eng.
He said this is despite the trade balance being in China’s favour.
“China is Malaysia’s largest trade partner.
“Our total trade with China from January to October 2018 expanded by 9.5 per cent to RM260.4 billion compared to RM237.9 billion in 2017,” he said in his speech at the Annual Network Gathering for Chinese Enterprises Association in Malaysia.
For this period, he said exports to China recorded a growth of 12.2% to RM115.75 billion, attributed to higher exports of electrical and electronics (E&E) products, chemicals and chemical products, as well as manufactures of metal.
Imports from China rose by 7.4% to RM144.61 billion.
“The trade conflict between China and the United States has also created a unique opportunity for Malaysia.
“In recent months, anecdotal surveys have shown increased interest from Chinese manufacturers to diversify their production bases into Malaysia and gain entry into both the ASEAN and western markets.
“Our approved FDI in manufacturing from China reduced from RM4.7billion in 2016 to RM3.9 billion in 2017, but increased tremendously to RM15.6 billion or 400 per cent in merely nine months from January to September 2018.
“This demonstrates that foreign investors’ especially China investors’ confidence in Malaysia is resurgent after the peaceful transition of power that took place on May 9, 2018,” he said.
“We have not deviated from our policy on foreign direct investment (FDI) from any country as long as it brings tangible benefits to the country, creates high-quality jobs and is in line with the objective of achieving high-quality growth bilaterally,” Lim added.
Latest data released by the Malaysian Investment Development Authority (MIDA) shows approved FDI in the manufacturing sector increased by RM35 billion, or 250 per cent, to RM49 billion for the first nine months of 2018, from RM14.0 billion in the same period last year.
Approved FDI from China led the way at 32% of the total, followed by Indonesia at 18.4%, the Netherlands at 17.0% and other investments from the USA, Korea, Japan and Singapore.