Asia is expected to lose out from the impact of the US-China trade war but Nomura analysts say Malaysia is best placed to benefit as an alternative source of imports, while Vietnam is set to gain as companies move production to escape tariffs.
The bank identified two areas where other countries in the region are set to benefit - import substitution in the short-term and production relocation in the medium-term.
“A prolonged US-Sino trade battle can be expected to result in companies in the US and China substituting with imports from other countries – China buying more soybeans from Brazil for example – and diverting manufacturing production to factories in other countries, or relocating production plants altogether”, the analysts said in a report.