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The Sun
6 hours ago
- Business
- The Sun
German companies in Malaysia remain strongly optimistic: MGCC survey
PETALING JAYA: German companies operating in Malaysia remain highly confident in the country's business environment, according to the latest World Business Outlook Spring 2025 Survey conducted by the Malaysian-German Chamber of Commerce and Industry (MGCC). The survey reveals that 91% of German businesses rate their current business situation in Malaysia as 'good' or 'satisfactory', underscoring sustained optimism despite a volatile global economic landscape. The biannual survey, part of a global initiative by the German Chambers of Commerce Abroad (AHK), captures the outlook of German businesses in over 90 countries. This latest edition reflects a growing sense of resilience, with 93% of respondents expecting business conditions in Malaysia to remain the same or improve over the next 12 months – a 30% increase compared to 2024. This jump signals a rebound in sentiment and renewed trust in Malaysia's position as a stable and attractive business destination. While optimism is strong, businesses remain alert to global risks. Geopolitical tensions, ongoing supply chain disruptions, and uneven economic recoveries continue to create uncertainty worldwide. In this context, 85% of companies in Malaysia view the local economic outlook as stable or favourable, although this marks a 12% decline from the previous year, indicating tempered expectations amid ongoing global headwinds. 'Despite a complex and evolving global landscape marked by geopolitical tensions, shifting trade policies and economic uncertainty, German companies in Malaysia remain strongly optimistic about the country's long-term prospects. These results reaffirm Malaysia's position as a strategic business and logistics hub in Southeast Asia – underpinned by its stable infrastructure, competitive cost structure, skilled and multilingual workforce and strong bilateral relations with Germany and the broader EU. 'As companies seek resilient, future-ready markets to grow and invest in, Malaysia continues to stand out as a reliable and attractive destination for German businesses across various sectors' said MGCC executive director Jan Noether. While the overall outlook remains positive, survey respondents also highlighted several areas that warrant attention moving forward. These include demand uncertainty (59.8%), economic policy conditions (46.1%), and regulatory considerations such as preferences for local firms (43.1%). These insights reflect the complexities of operating in a dynamic economic environment and underscore the importance of continued dialogue, policy clarity, and adaptive business strategies to ensure sustained growth and competitiveness. Globally, companies identified key long-term risks over the next five years, including trade barriers and conflicts (66%), global economic fragmentation (51%), as well as inflationary pressures and tightening monetary policy frameworks (36%). The survey also revealed concerns over the impact of the recent US trade tariffs, with 38% of companies anticipating a minor impact on local operations and 20.4% citing a major impact, largely due to expected increases in input costs, shifts in consumer behaviour, and reduced export demand. Interestingly, 36% of respondents said the tariffs would have no impact, with some noting potential opportunities for Malaysian-based operations to fill emerging supply chain gaps. Despite the global uncertainty, investment sentiment remains strong. A total of 68% of companies plan to either maintain or increase their local investments over the next 12 months – a testament to Malaysia's strategic value and growth potential in regional and global supply chains. Hiring trends also reflect a stable employment outlook: 40% plan to increase hiring while 53% intend to maintain current workforce levels. This reflects a 6% improvement in overall job stability compared to 2024. In Malaysia, the survey was conducted between March 17 and April 15 with 104 respondents from MGCC member companies, comprising mostly German companies with branches or subsidiaries in Malaysia, primarily from the manufacturing, trade, and services sectors, The AHK Network is supported by the German Ministry of Economic Affairs and Climate Action. The survey is part of the broader AHK World Business Outlook, a biannual global research initiative conducted by the German Chamber of Commerce and Industry. It surveys member companies from the network of AHK, which represent more than 40,000 companies in 93 countries.
New Straits Times
14 hours ago
- Business
- New Straits Times
Malaysia remains a bright spot for German firms amid global uncertainties
KUALA LUMPUR: Geopolitical tensions, ongoing supply chain disruptions, and uneven global economic recoveries continue to fuel worldwide uncertainty, making Malaysia an increasingly attractive base for businesses, according to the latest World Business Outlook Spring 2025 Survey. The survey, conducted by the Malaysian-German Chamber of Commerce and Industry (MGCC), found that 85 per cent of respondents still view Malaysia's economic outlook as stable or positive, although this marks a 12 per cent decline from last year, signalling more cautious sentiment amid persistent global challenges. Despite these headwinds, investment confidence remains firm. About 68 per cent of companies plan to maintain or increase their local investments over the next 12 months, reflecting Malaysia's strategic role in regional and global supply chains. Hiring trends are equally encouraging, with 40 per cent of respondents planning to expand their workforce, while 53 per cent intend to maintain current headcounts, a combined 6 per cent improvement in job stability compared to 2024. The biannual survey, part of a global initiative by the German Chambers of Commerce Abroad (AHK), was conducted between March 17 and April 15, 2025, with input from 104 MGCC member companies. This latest edition points to a resilient outlook, with 93 per cent of companies expecting business conditions in Malaysia to remain steady or improve over the next year, a significant 30 per cent increase from 2024. This rebound underscores renewed confidence in Malaysia's standing as a stable and attractive business hub. Overall, 91 per cent of German businesses rated their current situation in Malaysia as 'good' or 'satisfactory', highlighting sustained optimism despite global volatility. MGCC executive director Jan Noether said the findings reinforce Malaysia's position as a strategic business and logistics hub in Southeast Asia, supported by robust infrastructure, a competitive cost base, a skilled multilingual workforce, and strong bilateral ties with Germany and the European Union. "As companies seek resilient, future-ready markets to grow and invest in, Malaysia continues to stand out as a reliable and attractive destination for German businesses across various sectors. "Despite a complex and evolving global landscape marked by geopolitical tensions, shifting trade policies, and economic uncertainty, German companies in Malaysia remain strongly optimistic about the country's long-term prospects," he said. However, the survey also identified several challenges that warrant attention. These include demand uncertainty (59.8 per cent), economic policy conditions (46.1 per cent), and regulatory considerations such as preferences for local firms (43.1 per cent). These concerns highlight the complexities of operating in a dynamic economic environment and the need for policy clarity, constructive dialogue, and adaptable business strategies to maintain growth momentum. At the global level, companies cited major long-term risks over the next five years, including trade barriers and conflicts (66 per cent), global economic fragmentation (51 per cent), and inflationary pressures coupled with tighter monetary policies (36 per cent). The survey also reflected concerns about the recent United States trade tariffs. About 38 per cent of companies expect a minor impact on local operations, while 20.4 per cent anticipate a significant effect, mainly due to higher input costs, changes in consumer behaviour, and reduced export demand. Interestingly, 36 per cent foresee no impact, with some seeing opportunities for Malaysia-based operations to step in and bridge emerging supply chain gaps.
Daily Express
12-05-2025
- Business
- Daily Express
Malaysian companies must prepare for future challenges, say lawyers
Published on: Monday, May 12, 2025 Published on: Mon, May 12, 2025 By: Mikha Chan, FMT Text Size: Lawyer Raja Nadhil Aqran said companies should conduct an audit to determine which parts of the supply chain would be affected by the tariffs. PETALING JAYA: Malaysian companies must always be prepared for extraordinary circumstances, such as the US 'reciprocal' tariffs policy that has threatened to upend deals worldwide, according to lawyers. Commercial lawyer Raja Nadhil Aqran said businesses should review their contracts 'to make sure (such) things are addressed properly', while his Austrian counterpart Harald Sippel said steps should be taken to protect them from the negative impact of major changes. Nadhil observed that Asian companies tend to take a wait-and-see approach when faced with major challenges such as the tariffs. '(They typically say) 'we'll play it by ear, see how it goes. Wait until other people do something, and then we'll follow',' he said at a seminar on the impact of tariffs on Malaysian companies at the Malaysian-German Chamber of Commerce and Industry earlier this week. Last month, the Trump administration announced that it was imposing a range of 'reciprocal' tariffs on about 60 countries, including Malaysia which will see a 24% levy on its exports to the US. While the tariffs have been paused for 90 days from April 9 to July 8 to allow for trade negotiations, a 10% blanket duty on almost all imports into the US remains in place. Malaysia is the second-largest semiconductor manufacturer in the world, with 60% of its exports going to the US. Investment, trade and industry minister Tengku Zafrul Aziz said the government is approaching current negotiations with the US from 'a position of strength', as the economy grew 5.1% last year and remains stable. Nadhil said companies should subject themselves to an audit to determine which parts of the supply chain would be affected by the tariffs. Sippel said although existing contracts already 'say what they say', all parties involved can mutually agree to amendments. However, he said, contracts drawn up after the introduction of the tariffs should be future-proofed with clauses written specifically to withstand any negative impact from major changes. 'As a lawyer, I must say that nothing is certain in life. We don't know what's going to happen – maybe we'll stick with the 10% baseline (blanket duty), maybe we'll go back to the 24% reciprocal tariffs,' he said. He said other possibilities include an escalation of the US-China trade war, or a removal of tariffs between the US and EU, followed by the EU imposing similar tariffs on other countries. 'There is a lot of uncertainty, and your contracts must reflect this uncertainty,' he added. Nadhil said any clause to future-proof contracts must cover price adjustments to determine how and when prices can be changed. He said contracts must also include force majeure clauses that relieve parties from liability in circumstances that are impossible to control, and termination clauses to allow parties to exit contracts. * Follow us on Instagram and join our Telegram and/or WhatsApp channel(s) for the latest news you don't want to miss. * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
