Malaysian Prime Minister Mahathir Mohamad said the current surge in protectionism highlighted by the US-China trade war will not last long and free trade will triumph in the end. He was speaking yesterday at the Asean Business and Investment Summit 2019, an annual sideline event to the Asean Summit held in Bangkok from Thursday till tomorrow.
"Popularism is mounting in Europe and America where there are talks about limiting trade, about trade wars and applying higher taxes for imports.
"But I think this will not last very long because they will understand that if they cut themselves off from the new producers, they tend to lose a lot. They cannot really stop trade from expanding and becoming multilateral," said the 94-year-old veteran politician.
Calling US President Donald Trump - who did not participate in the summit for the second year in a row - "not a very nice man", Tun Dr Mahathir hit back at US protectionist policies, particularly the trade war with China, and his presidency.
In June last year, Mr Trump began to impose tariffs and other trade barriers on China to force the country to stop what the US called "unfair trade practices". China retaliated with its own tariffs on imported products from the US.
Dr Mahathir said China's growth resulted from the fact that the country has fully utilised human capital, something Asean has yet to achieve, mainly due to the fragmented voices of the 10-nation bloc.
Dr Nigel Gould-Davies, a political science professor at Mahidol University near Bangkok, said: "Mahathir's remarks show how much has changed. After the 1997 crisis, he was a bitter critic of globalisation. Now he calls for Asean to unite to protect an open global economy against the threat to it from the US. It's a remarkable reversal."
With the absence of Mr Trump and US Secretary of State Mike Pompeo from the summit due largely to an impending impeachment move against the US President, the downgraded American presence is deemed to have given China room to further exert influence in South-east Asia, he added.
At the summit, AirAsia chief executive Tony Fernandes pointed to barriers such as Customs duties as the biggest obstacle for trade development within the Asean region, while urging Asean governments to facilitate companies in the bloc so that they are able to compete with global companies.
