Malaysia has made it clear that it will not be picking sides in the ongoing tech war between the U.S. and China. The country’s Minister of Home Affairs, Saifuddin Nasution bin Ismail, emphasized that Malaysia will continue to work with both superpowers.
What Happened: Saifuddin, speaking at Fortune’s ASEAN-GCC Economic Forum in Kuala Lumpur, stated that Malaysia’s approach is to not align with any specific side. “For a country like Malaysia, our practical solution or practical position now is that we do not need to choose sides,” he said. “Instead, we have chosen to work with both,” reported Fortune.
He further elaborated on the benefits of this approach, saying, “I believe that working with both China and the U.S. brought us real benefits, and this means we can bring the most relevant, affordable, and effective AI tools into our country.”
"We choose what is best for Malaysia based on our needs,” added Saifuddin.
Malaysia’s open-door policy is designed to enable its youth to gain experience in tech hubs such as Silicon Valley and Shenzhen, while allowing its companies to draw insights from both the U.S. and Chinese AI ecosystems.
That being said, on Sunday, AP News reported that Malaysia's foreign minister, Mohamad Hasan, called for co-operation among ASEAN countries to brace for external shocks as he said, “ASEAN nations are among those most heavily affected by the U.S.-imposed tariffs. The U.S.–China trade war is dramatically disrupting production and trade patterns worldwide. A global economic slowdown is likely to happen."
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Why It Matters: Malaysia’s stance on the U.S.-China tech rivalry is significant in the context of its recent tech developments. In March, Microsoft MSFT announced the establishment of its first cloud region in Malaysia, which is set to open in the second quarter of 2025. This move is expected to provide businesses in Malaysia with better performance, enhanced security, and reduced latency.
Furthermore, Arm Holdings-ADR ARM signed a $250 million agreement with Malaysia to supply chip designs and technology for the next ten years. This deal is part of Malaysia’s efforts to boost its chip design and tech ecosystem.
However, Malaysia’s tech industry has also faced challenges, such as the need to tighten semiconductor regulations due to U.S. demands to monitor the movement of high-end NVIDIA chips amid suspicions of illicit diversion to China, violating U.S. export controls.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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