A basic view of the Sino-Malaysian trade

• Main Author: Ungku Abdul Aziz, Ungku Abdul Hamid
• Format: Other
• Published: Nil
• Subjects: H Social Sciences (General); HC Economic History and Conditions; S Agriculture (General)
• Online Access: http://commonrepo.um.edu.my/12381/6/Uploaded-%20A%20Basic%20View%20of%20the%20Sino-Malaysian%20Trade%3B%20Ungku%20Aziz.pdf; http://commonrepo.um.edu.my/12381/

Since the 14th century, there has been a remarkable constancy of trade in between China and Malaysia. However, the trade pattern has undergone some evolutionary changes from 16th to the 19th century. First and foremost, the increased population of Nanyang residents has increased the demand for foodstuffs and more functional textiles from China. Similarly, the composition of exports to China has changed as well. It was now rapidly dominated by the new raw materials, eg: rubber. Generally, the imports from China tend to be more stable than the export to China. A major part of total imports consists of food and beverages, tobacco and manufactured goods. With the more established operative trading system, Chinese traders tend to be at a more favorable stand over the importers. In terms of exports, Malaysia tries to maintain the position as the biggest importer of China’s natural rubber imports. However, due to the strong competition from Sri Lanka and Thailand, the balance of trade has continuously been in China’s favor. Therefore, neither imports nor exports that Malaysia is in a sufficiently strong position to exert much leverage. The character of Sino-Malaysian trade is considerably influenced by the Chinese community lifestyle in Malaysia. The urbanization of Chinese community and their consumption of a great variety of imported food have sustained a constant trade pattern with China. The unique distribution of Chinese clans and dialect groups, as well as the tightly organized system of trade associations (a polite euphemism for monopolies and monopsonies), have dominated the import and export composition of Sino-Malaysian trade. In the New Economic Policy, Malaysia government has tried to restructure the society by trying to encourage “Bumiputera” to enter this sector. However, due to the scarcity of resources, the Malaysia government has designated a trading corporation, Pernas to supervise and streamline the trading between China and Malaysia. The participation of the Chinese community in the higher income yielding sectors and their ownership of assets in the industries strengthen their buying power. This provided them the sufficient economic power to generate a strong sustained demand for a broad-based of imported food from China. Thus, It is unlikely that the “restructuring society” is going to affect the patters of Sino-Malaysian trade in the foreseeable future.