Deploying leverage for a win-win outcome, minimising the impact on the economy
OVERVIEW
- Tariff tantrum. The global market remains in turmoil, with little distinction between noise and signal whenever President Trump reacts to retaliations in response to his sweeping and country-specific tariffs. While Washington claims over 70 countries are willing to cut a deal, tensions with China continue to escalate.
- Global institutions have sounded alarms over rising trade tensions. The WTO warns of an 80.0% drop in US-China trade and lasting damage to global trade systems. The World Bank flags rising costs and investment risks, while the IMF has downgraded 2025 global growth to 2.4% (from 3.1%) due to escalating trade conflicts.
- Malaysia’s bargaining chips. To escape legacy Trump-era tariffs (25.0% steel, 10.0% aluminium, 15.0% solar) and the new 24% reciprocal levy, Malaysia must leverage its strengths: a key role in US tech and semiconductor supply chains, critical rare earth processing capabilities, and healthcare exports.
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