Malaysia Us Reciprocal Trade Deal Geopolitical Blunder

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 In fortifying bilateral economic relations, Malaysia and the US reached an agreement to provide both countries’ exporters unprecedented access to each other’s markets.
Several analysts believe Malaysia is walking a tightrope in its international relations, balancing the East and the West, navigating between the US and China with a mix of strategic ambiguity and economic diplomacy.
As a highly open economy, Malaysia must maintain a neutral foreign policy to navigate the rivalry between the two superpowers, though this balancing act has become increasingly complex.
While maintaining cordial relationships with both the US and China, it is equally vital that Malaysia does not appear to lean toward either side, or even create the impression that it is compromising its neutrality by aligning with one power over the other.
Malaysia has apparently engaged in a delicate dance, one that allows it to preserve relations with both superpowers without showing an iota of preferred alignment, thereby drawing economic and security benefits from both directions.
By entering into the recent Malaysia-US reciprocal trade agreement, how does such an agreement square with Malaysia’s traditional neutrality policy?
Azmin right to worry
It seems to me former trade minister Azmin Ali rightly cautioned the government that the new deal would possibly threaten the country’s ties with China, and being Malaysia’s largest trading partner, Azmin's advice appears to carry considerable weight.
According to Azmin, Article 5.1 is highly disturbing because it requires Malaysia to copy any US trade restrictions or sanctions against other countries.
Ex-minister Azmin AliThe Perikatan Nasional secretary-general argued: “If Washington decides to block imports from China or Russia, Malaysia must do the same, even if it harms our economy.”
Ergo, Azmin believes such a mind-boggling clause would force Malaysia to take sides, thus jeopardising the principle of neutrality which it purports to hold dear.
Zafrul’s feeble proposition
Investment, Trade and Industry Minister Tengku Zafrul Abdul Aziz, who reportedly was satisfied with the deal, disagreed with Azmin.
He contended that Article 5.1 merely requires Malaysia to mirror US trade policies against another country, and he believed that this is only applicable when it also impacts Malaysia.
With the greatest respect, a careful reading of the relevant clause seems to fortify Azmin’s argument, thus rejecting Zafrul’s feeble proposition.
Investment, Trade and Industry Minister Tengku Zafrul Abdul AzizWhen Article 5.1, inter alia, states - “If the US imposes a customs duty, quota, prohibition, fee, charge, or other import restriction on a good or service of a third country and considers that such a measure is relevant to protecting the economic or national security of the US...” - I really have difficulty rationalising Zafrul’s reason.
The minister also asserted that “the text spells out that such measures are to address a shared economic or national security concern and the keyword is ‘shared’. If it only affects US economic and national security, but doesn’t impact Malaysia... we don’t need to consider it.”
With due respect, I don't think the clause evinces the meaning as ventilated by Zafrul. The clause is too clear, favouring the US, thus it is only interested in protecting the economic or national security of the US and not Malaysia.
Therefore, Uncle Sam wants Malaysia to adopt or maintain a measure with an equivalent restrictive effect as the measure adopted by the US.
If Zafrul was right in interpreting that Article 5.1 encompasses a shared economic or national security concern, one may argue then that the phrase “such a measure is relevant to protecting the economic or national security of the US” would become otiose. - Mkini
HANIPA MAIDIN is a former deputy minister.
The views expressed here are those of the author/contributor and do not necessarily represent the views of MMKtT.

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