Malaysian businesses increase connections with China, HSBC survey shows
KUALA LUMPUR, June 13 (Xinhua) -- Malaysian businesses are adapting their trade strategy to significantly increase connections with China (61 percent) amid global uncertainties, a survey by HSBC showed.
The bank said in a statement on Thursday that Malaysian businesses have been hit with surging costs and supply chain disruptions and are having to rethink their strategy and planned investments as U.S. tariffs and shifting trade policies continue to impact their enterprises.
Considering current trade dynamics, Malaysian businesses have also been keen on increasing their connections with South Asia (55 percent) and North Asia (44 percent).
Meanwhile, the survey found that currently, the biggest concern for more than half of Malaysian businesses (55 percent) is rising costs due to tariffs and other trade-related factors.
In response to this, 42 percent of Malaysian businesses have shifted their focus to domestic markets, prioritizing local customers and reducing international exposure while 40 percent of businesses plan to do the same.
In addition, 37 percent of Malaysian businesses have increased their inventory levels to manage supply disruptions, with 49 percent planning to do so as well.
Despite global uncertainties, 250 Malaysian-based companies surveyed are optimistic about their international growth but are in need of external strategic advice on the matter.
About 91 percent of companies are confident they can grow international trade, ahead of the 89 percent global average.
More encouragingly, 73 percent think that trade uncertainty has encouraged their business to evolve and explore new opportunities while 55 percent are seeking strategic advice on international expansion, restructuring or supply chain realignment.
"Despite the challenges posed by the uncertain tariff and trade landscape, businesses in Malaysia are demonstrating resilience and adaptability in the way they operate," said Omar Siddiq, chief executive officer and head of banking, HSBC Malaysia.
While supply chains may be further reconfigured, he noted there continues to be strong potential for local companies to leverage on Malaysia's strong trade ties particularly in Asia.
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