MALAYSIA IN POSITION OF STRENGTH

The Star

26-05-2025

KUALA LUMPUR: Malaysia is coming from a position of strength amid the current economic uncertainty, sparked by the global tariff war.
Former chairman for London's Standard Chartered group Jose Vinals said that while tariff imposition by the United States could have an impact on the country's future growth, strengths like its current Asean chairmanship is among the drivers supporting the overall economy.
Vinals, who remains as an adviser at the global lender, noted that the country's other strengths included political stability, sound national economic policies, a good business environment and proper rule of law.
'The country is endowed with rich natural resources and you also have tremendous talent in the country.
'The creative minds here have made Malaysia a country that revolves around trade and technology,' Vinals told StarBiz during a visit here last month.
As Asean chair, Malaysia is well positioned to facilitate intra-Asean integration and cohesion even against the backdrop of the current economic environment, which is fraught with uncertainties, he added.
'Asean is one of the top five strongest economic regions in the world and it's a powerhouse in Asia with a multi-engine growth story, which we expect will continue to attract strong foreign direct investment flows as investors seek to diversify their operational capacity and tap into new markets.
'Uncertainty creates new risks, but also new opportunities in fast-growing trade corridors like Asean, sustainable development, and cross-border wealth.
'A very important role that Malaysia can play is leveraging its good sense of economic diplomacy and the value of international connectivity to drive further cohesion to benefit global trade,' he said.
Malaysia, like most countries, is likely to be impacted by the US' imposition of tariffs – which is currently on a pause – but the ultimate narrative is dependent on the final negotiations that take place between the United States, Malaysia and the other countries.
'It's too early to say whether the global economy will undergo a recession, but what we can expect is volatility.
'How big an impact it will have will depend on the final negotiations that take place, but it will certainly have a negative impact on growth,' he said.
As with other Asean countries, Malaysia's economy has prospered through open trade, Vinals said, adding: 'I am a fan of open markets and free trade.
Globalisation has brought a lot of benefits to the world when it comes to open trade and investment flows, and the answer is making sure we have freer and fairer trade, not necessarily by increasing tariffs but by removing barriers to trade.'
He shared that the role of Standard Chartered is to leverage its global network across 53 markets – including all 10 Asean markets – and local market expertise as a super connector to support wealth, trade and investment flows and drive cross-border growth, with a focus on emerging high potential corridors and helping clients navigate increased complexities.
'In Malaysia, Standard Chartered has maintained a strong relationship with clients and stakeholders for 150 years.
'We have a fantastic franchise here and are working hard to make it even better.
'Our strong and very diverse business lines, excellent capital strength and asset quality position us well to continue to support our clients in the structurally higher growth and vibrant markets in which we operate.
'We're staying close to our clients to help them navigate today's uncertainties and enable them to find and seize new opportunities,' he said, adding that the bank continues to work closely with its clients as they adjust their supply chains, adapt their business models and cope with the expected lower global and local growth.
'Malaysia has a bright future ahead, and it will require work, but the trust and relationships we've built here gives us tremendous confidence that we're going to continue moving further and faster.'
Commenting on the interaction he has had with colleagues, clients and stakeholders, he said that there is 'tremendous energy' to move forward.
'Through my interactions here, I can see that there is tremendous energy to move forward, and every time I come to Malaysia, I am overwhelmed by how welcoming and warm the people are.
'I think that Malaysians are truly wonderful and I leave Malaysia with all of my batteries recharged and confident in the future of the country.'