(From left) American Malaysian Chamber of Commerce chief executive officer Siobhan Das and chairman Antony Lee, with former deputy international trade and industry minister Ong Kian Ming. (Photo by Patrick Goh/The Edge)

KUALA LUMPUR (March 11): Southeast Asia will remain on the radar when investors look to diversify their supply chains outside of China, as the coming US presidential election will have not much effect on the China plus one (China+1) strategy adopted by multinational companies (MNCs), according to former deputy international trade and industry minister and Malaysian Investment Development Authority (Mida) board member Ong Kian Ming.

Ong said that regardless of the US election result, the foreign policy of the world's largest economy on China will be unchanged, meaning the China+1 strategy will still be in play.

“I think regardless of who will be the next president of the US after 2024, the US foreign policy on China will remain the same,” Ong said during the launch of the American Malaysian Chamber of Commerce’s (AMCHAM) Economic Impact Survey (EIS) 2022-2023.

“[This] means that the China+1 strategy that many companies are pursuing — whether its American, European, Chinese, Japanese, Korean, Taiwanese — will continue, which means the focus will still be on Southeast Asia,” he added.

Nonetheless, Ong underlines that the challenge lies in the Malaysian government enticing these investors to invest in the country instead of its regional counterparts.

“I think the challenge for the Malaysian government, the different agencies involved, including Mida, which I’m a board member of, would be to try to make the pitch for why Malaysia is the best place to invest for certain types of companies that we want to target,” he added.

According to AMCHAM chief executive officer Siobhan Das, Malaysia does have a leg up on its regional counterparts in terms of human capital, with its labour force being skilled and multicultural.

Meanwhile, Ong noted that Malaysia’s strategic plans announced last year, namely the New Industrial Master Plan (NIMP) 2030 and National Energy Transition Roadmap (NETR), portray to investors that the country has a clear strategic direction going forward, playing to its attractiveness as an investment destination.

"Malaysia is one of the few countries in the region that has this kind of very clear strategic direction," he added.

AMCHAM chairman Antony Lee, who is also CEO of AIG Malaysia Insurance Bhd, noted that other factors to consider in terms of a nation's attractiveness to investors are legal predictability and risks of natural disasters.

According to AMCHAM’s EIS 2022-2023, which surveyed 81 of the association’s member companies, Malaysia is an important hub for manufacturing in the region with 57% of manufacturing members being operationally linked to other Asean nations.

AMCHAM is a business association comprising 300 American, Malaysian and international member companies — including the Malaysian arms of Meta, Google, IBM, Coca Cola, Oracle, and Amazon Web Services.