Speculating the U.S. Presidency's Impact on Malaysia

Disclaimer: This is just my personal take based on what I’ve researched online.

So, with the U.S. presidency announcement looming, I couldn’t help but wonder how Malaysia’s trade and consumer landscape might shift based on whether Harris or Trump takes the White House. Here’s my best guess.

If Harris Wins

Let’s say Harris clinches it. We might see a more predictable trade pattern, especially with a focus on climate policies and global cooperation. Harris could likely keep the U.S.-China trade tension low-key, meaning Malaysia might avoid any massive disruptions in our trade flow. Plus, if her administration goes all-in on tech and green initiatives, we might even see more American investments trickling into Malaysia’s tech sector – think semiconductors, electronics, or even renewable energy projects.

For us as consumers, this could mean more choices and possibly even lower prices on tech and eco-friendly goods, as American companies start outsourcing more tech production here. That said, a Harris presidency might emphasize stricter labor and environmental standards, which could pressure local manufacturers a bit. But overall, Harris could be pretty business-friendly with a touch of diplomacy.

If Trump Returns

If Trump is back, we’re likely to see his America-first stance kick back in. He might push tariffs or make some bold moves against China again. This could be a mixed bag for Malaysia. On the one hand, local businesses that export to the U.S. could benefit from less competition if the U.S. tries cutting down Chinese imports. But if tensions with China escalate, there could be some strain on our consumer goods and supply chain.

As consumers, we might face a slightly more expensive market with fewer options, especially if tariffs come back in full force. But who knows? Trump’s unpredictable style means anything could happen, and it could bring a few surprises for Malaysia.

NOTE: When Trump is back in office, he would focus on bolstering the dollar and supporting the stock market, which could indeed impact the price of gold. Here’s why and how:

1. Strengthening the Dollar: Trump has often expressed a strong preference for a robust dollar, which he sees as a symbol of U.S. economic power. If he implements policies aimed at boosting economic growth, like tax cuts or incentives for domestic production, it could increase the demand for dollars and, in turn, strengthen the currency. A stronger dollar typically reduces the appeal of gold as an alternative asset because gold prices often move inversely to the dollar’s strength—meaning when the dollar rises, gold prices tend to fall.

2. Stock Market Emphasis: Trump has historically favored policies that benefit the stock market, such as corporate tax cuts and deregulation, with the goal of making U.S. businesses more competitive. If he follows a similar approach, investor confidence in equities could grow, potentially diverting investment away from “safe-haven” assets like gold. When stocks are booming, investors may view gold as less attractive, further driving down its price.

3. Inflation and Interest Rates: Trump’s policies could also influence inflation and interest rates, which are key drivers of gold prices. If his economic strategies push inflation down or lead to higher interest rates (as the Federal Reserve might respond to curb inflation), the opportunity cost of holding non-yielding assets like gold increases. This dynamic could lower demand for gold, especially if investors can find higher returns in stocks or interest-bearing assets.

A Trump presidency with a focus on strengthening the dollar and supporting equities could indeed put downward pressure on gold prices, as investors might see less need to hedge against economic uncertainty. However, the gold market can be complex, and any shifts in global economic conditions or geopolitical tensions could also impact its demand.

Impact on Malaysia's Pharma Industry: Harris vs. Trump

If you’re in the pharma world, like me, you know that the U.S. has a massive influence on the industry. So, whether it’s Harris or Trump who takes the White House, there’s bound to be a ripple effect reaching us in Malaysia. Let’s break it down.

With Harris in Office

Harris has always shown an interest in healthcare access and affordability, which could mean policies supporting generics and international collaboration. This might translate to easier regulatory pathways and faster approvals for Malaysian-made generics heading to the U.S. Plus, if she focuses on pandemic preparedness, there could be more opportunities for Malaysia to export medical supplies, vaccines, or even leverage U.S. investments in our biotech sector.

For the Malaysian pharma industry, a Harris administration could open doors to smoother U.S. partnerships and increased demand for cost-effective generics. It might also encourage Malaysian companies to meet higher compliance standards, especially if Harris pushes for stringent environmental and labor practices globally.

If Trump Returns

Now, if Trump comes back, we might see a push for the U.S. to “buy American.” He could reinforce incentives for U.S. pharma to produce locally, which might limit the opportunities for Malaysian companies hoping to export to the States. But at the same time, Trump’s tendency to challenge China on trade could offer openings for Malaysia to step in as an alternative supplier, especially if he looks for trade allies in Asia.

For Malaysia, Trump’s policies could mean shifting opportunities. There’s a chance for us to become a more significant player in API (active pharmaceutical ingredient) production if American companies want alternatives to China. However, the high demand for self-reliance in the U.S. might keep them looking inward.

NOTE: Once Trump wins the presidency, the pharmaceutical industry could experience some significant changes, especially given his focus on drug pricing, regulatory processes, and international trade.

1. Drug Pricing and Market Shifts: Trump has consistently advocated for lower drug prices, pushing ideas like benchmarking U.S. prices against international standards. With a second term, he may reintroduce policies that promote transparency and competitive pricing, which could encourage pharmaceutical companies to keep costs in check. While this may limit profit margins in some areas, it could also make drugs more accessible and potentially increase demand due to wider affordability.

2. Streamlined Regulatory Approvals: Trump’s previous administration focused on reducing regulatory hurdles to speed up drug approvals. This approach could return, making it easier for innovative treatments to reach the market faster. Such a regulatory environment would benefit companies ready to launch new drugs and treatments, though there may be concerns around balancing speed with safety in the approval process.

3. Domestic Production Focus: With Trump’s focus on bringing pharmaceutical manufacturing back to the U.S., the industry could see a shift in supply chains, reducing dependency on overseas sources, particularly from China. Policies to incentivize domestic production may increase short-term costs but could strengthen the U.S. pharma supply chain and create more jobs in the sector.

Altogether, a Trump presidency would likely push the pharmaceutical industry to navigate new policies on pricing, regulation, and production, creating both challenges and opportunities as the industry adapts to these shifts.

Final Thoughts

The pharma industry in Malaysia will adapt either way, but the tone and direction from the White House could significantly influence how quickly we grow or what kind of partnerships we build. Either way, it's a time to stay watchful and maybe even strategic in our exports and investments.

(Just for fun) Will PMX Be the First to Call?

Now, about PMX…would he be the first to ring up the White House? My gut says, yes, he’d likely reach out fast – Malaysia’s always valued its close ties with the U.S., no matter who’s in power. Plus, given the current focus on maintaining good trade relations, I’d bet he’d make that call swiftly to show Malaysia’s open for business and ready to collaborate.

Each presidency has its pros and cons for us in Malaysia. But no matter what, we’ll keep adapting – we’ve always been good at that ;-)

UPDATE: The "Devil You Know" Perspective Post-Election

With Trump's victory now confirmed, the phrase "better to work with the devil you know than the devil you don’t" rings even more relevant. For Malaysia, dealing with Trump's known strategies means we can brace for certain policy directions, allowing us to better anticipate the landscape.

If Trump Wins: Trade, Tech, and Ties with Global Entrepreneurs

Trump's re-election brings back some familiar trade pressures, especially on China and the Asia-Pacific region. Malaysian businesses could feel both the challenges and unique opportunities arising from this scenario. Given Trump’s interest in nationalistic economics, the U.S. might reinforce tariffs and trade policies that place extra scrutiny on foreign products, prompting Malaysia to explore tighter partnerships within ASEAN and other global allies.

The Musk and Ramaswamy Factor: Emerging Influencers in Policy

Elon Musk and Vivek Ramaswamy, both prominent in tech and business, have increasingly influential voices in Trump’s circle. Musk’s innovative direction in tech and autonomous systems could lead to a focus on reshoring American manufacturing, impacting Malaysia’s semiconductor and tech exports. Vivek Ramaswamy, with his pro-entrepreneurship ethos, aligns well with Trump’s economic ideology, and he may advocate for new bilateral tech initiatives. This could open doors for Malaysia, particularly in biotech or tech manufacturing partnerships, where we bring value as a tech-savvy yet cost-effective production partner.

Shifts in the Global Financial Market

The impact of Trump’s policies on the U.S. dollar and market dynamics will likely be influenced by Musk's ventures in digital finance and Ramaswamy's vision for decentralization. For Malaysians invested in U.S.-linked assets or cryptocurrencies, platforms like LUNO could become increasingly attractive as these assets are expected to fluctuate under the new administration.

As the dust settles, Malaysia stands ready to work within this familiar yet evolving landscape, prepared to make the most of both the challenges and the doors this next administration may open.