Malaysia-Taiwan Tensions Likely More a Sentiment Risk

Dow Jones
08/20

0343 GMT - Diplomatic tensions between Malaysia and Taiwan are likely more of a medium-term FDI-confidence and equity market sentiment risk than an immediate macroeconomic shock, Apex Securities analysts say in a note. Tensions flared after Malaysian Prime Minister Anwar Ibrahim described Taiwan as a Chinese province seeking independence, drawing a rebuke from Taiwan. Existing trade and semiconductor links are expected to remain resilient, with limited near-term impact on corporate earnings, the analysts say. However, prolonged tensions could make Taiwanese companies more cautious about new investments, particularly in Malaysia's semiconductor and E&E sectors, they add.

 

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