DONALD Trump shocked the world on Wednesday to become the new President of the United States of America. What would the impact be on the rakyat?
Let us take a look at some of them.
Trump will be good for world trade
Second Finance Minister Datuk Johari Abdul Ghani told the New Straits Times on October 9 that Trump would be good for global trade. This is because Trump comes from a corporate background and he is not a politician.
So what this means is that Trump will prioritize on doing trade and business. This is good for Malaysia as we we are among the world’s top 20 trading nations and the US is one of our top ten trading partners. Increased trade with the US would mean a better economy for Malaysia and this would mean a better standard of living for the rakyat.
Funds from the Muslim world will come to Malaysia
Trump had openly said that he will not allow any Muslims to enter America until he figures out what is happening. In other words, he is blaming Muslims for all the terrorists attacks in the US.
The Muslim world will react and they will invest their money else where and will not park their money into the US.
This is what happened right after the September 11 attacks in 2009 and the US blamed the Arab terrorists. As a result, all the Arab investments were pulled out and went to other parts of the world such as China, Europe, Japan and Asia which includes Malaysia.
This is good for Malaysia as Arab funds will come into Malaysia and they will invest in big projects in Malaysia which will provide jobs and salaries for the rakyat.
More Arab tourists will come to Malaysia
After 9/11, there was a huge number of Arab tourists visiting Malaysia as the US branded them as terrorists. This could happen once again as Arab tourists will not have plans to go to the US and visit elsewhere instead which include Malaysia.
This will be good for our economy as tourists will come and spend in Malaysia on hotels, food, shopping and traveling. This will be good to the rakyat as they will be able to earn an income.
The rakyat can get higher dividends from their ASB and ASN
Right after Trump became president, stock markets all over the world crashed. This include Bursa Malaysia. This is a good opportunity for the Employees Provident Fund, Permodalan Nasional Berhad, Kumpulan Wang Amanah Pencen and Tabung Haji. This is because all these investment agencies manage the rakyat’s money.
PNB for example, manage Amanah Saham Nasional and Amanah Saham Bumiputera. When the stock market crash, the shares become cheaper and PNB and EPF can buy them at cheap prices.
When the stock market rebounds, they can sell the shares at higher prices and make profits. This translates into higher dividends for the rakyat’s EPF, ASB or Amanah Saham Wawasan and others.
This is true because Wall Street climbed to a historical high on Wednesday, a day after Trump was elected president. Bursa Malaysia has also rebounded and this is good for the rakyat who invest in ASB, ASN or have an EPF account.
Malaysia and ASEAN will always be very important to the US
Malaysian Institute of Economic Research executive director Datuk Zakaria Abdul Rashid said Trump’s presidency will have minimal impact on the Malaysian economy. The ultimate decision would have to go through congress and the US will realise that ASEAN is an important economic power.
This is very true as ASEAN is among the world largest economic region and the US is unlikely to do anything that can disrupt economic stability in Malaysia. So the rakyat can continue to work hard to ensure that Malaysia remains as one of the strongest economic power in the region.
The weak ringgit will provide better income to some segment of the rakyat.
As soon as Trump was announced as the new US president, the ringgit weakened to RM4.10 to the US dollar. UOB Bank Malaysia Berhad said on Tuesday that it expects the ringgit to weaken further to RM4.2 by year end.
This is good for exporters of electrical and electronics products as well as palm oil. This is because they earn their money in ringgit.
When the US dollar is weak, the exporters will earn higher ringgit. This would enable some Malaysians to earn better income and palm oil smallholders could also make higher profit.
MIDF group managing director Datuk Mohd Najib Abdullah said a gradually weakening US dollar would be positive on the income of many palm oil exporters as it will translate into higher ringgit revenue.
Trump will make US economy stronger
Sunway University economics professor Dr Yeah Kim Leng said already there are signs of an improving US economy. A stronger US demand should help boost Malaysian exports especially in the electrical and electronics sector which makes up 30 percent of our gross domestic product.
The US likes our electrical and electronics products such as televisions, washing machines and microwave ovens and demand will continue to provide employment and income for the rakyat working in the sector.
The Malaysian economy still resilient
Mohd Najib Abdullah also said the Malaysian economy is still strong and resilient. Standard & Poor also reaffirmed Malaysia’s economy as still strong giving it an A- rating. What this means is that the Malaysian economy is still strong and the government is doing the right thing to ensure that the rakyat is having a good life earning a reasonable income.
Nik Haikal Nik Ibrahim is an independent analyst and Malaysian Access reader. Article written is strictly his personal view. Malaysian Access does not necessarily endorse the opinions given by any third party content provider.