Former Malaysian prime minister Mahathir Mohamed believes US tariffs are part of a wider attempt by America to weaken China but says it is unlikely to succeed.
China has the “technology and capacity” to get through the economic slowdown, Mahathir said in an interview with the South China Morning Post.
“The country’s whole market is bigger than that of Europe and America combined so China will grow,” he was quoted as saying. “You can’t stop China.”
Malaysia has been seeking an amicable solution to tensions with the US following President Donald Trump’s imposition of a 24% tariff on the counrtry last month, before higher duties were paused for 90 days.
Malaysian Prime Minister Anwar Ibrahim pledged to forge stronger trade ties with China during a state visit by President Xi Jinping, calling him a steady leader in a time of global upheaval.
Anwar has also been leading the call for Asean to present more of a united front in trade negotiations with the United States. Malaysia ischairing the 10-country body this year.
Malaysia is a “neutral country” and wants to be friendly with the world, to trade with all nations, Mahathir said in the interview. The country must not side with anyone — neither America nor China, he said.
Mahathir, 99, is Malaysia’s longest-serving premier. His political career began in 1964, and his rise to power was marked by a push for policies favouring Malays and other indigenous people who make up the majority of the country’s more than 33 million people.
Mahathir questioned whether Anwar understood the complexities of geopolitics, describing his one-time protégé as “naive” and accusing him of putting economic expediency over principle, according to the Morning Post.
Malaysia’s $26-billion trade surplus with the US puts it at risk, but the figure is far less than the surpluses of other Asian nations including Thailand, Vietnam, South Korea and India.
It also has the benefit of continuing to look like a relatively affordable alternative to China — whose nearly $300-billion surplus with the US put it at the top of Trump’s list — as supply chains continue to shift.
The United States was the second-largest destination for Malaysian exporters in 2024, after China.
Last week, Malaysia’s Trade Ministry said iy was open to narrowing the US trade deficit, addressing non-tariff barriers, strengthening technological safeguards and security, and exploring a potential bilateral trade agreement.
Malaysia has been trying to mitigate the impact of the trade war on its economy, including delaying a planned expansion of its sales and service tax, which provides a temporary reprieve for manufacturers bracing for higher US tariffs.
Factory owners have urged the government to refrain from adding to tax burdens this year after the US threatened to impose the new levies.