(Original title: "We have to build two 'kitchens' to satisfy China and the United States")

The Network of Observers.

According to a report by Hong Kong's "South China Morning Post" on October 5, Malaysian Minister of Investment, Trade and Industry Zaffr recently said that as the differences between the United States and China, the world's two largest economies, become increasingly prominent, companies want to survive, They must build two "kitchens" to meet the different needs of the United States and China.

"Our factories and our businesses must start preparing for the 'two kitchens'." Zawr told The South China Morning Post's This Week in Asia. According to the report, Zaffr is referring to the fact that companies must now cater to the increasingly differentiated needs and rules of the United States and China.

Since Trump announced the so-called "Liberation Day tariffs" in April this year, the chain reaction has spread throughout Southeast Asia, with tariff rates ranging from 19% to 49% eroding the export and economic growth expectations of countries in the region. For many manufacturers, the most pressing issues at the moment are about survival: where to build a factory, what products to produce, and, most importantly, who to sell to.

Although Trump argued that the tariffs were imposed to reduce the U.S. trade deficit, analysts agreed that the U.S.'s real target is China, which it sees as a strategic competitor. Southeast Asia, especially transit centers such as Malaysia and Vietnam, are caught in the cracks of this global economic adjustment.

The report pointed out that for decades, the prosperity of Southeast Asia has largely relied on its role as a global manufacturing base-serving the two major markets of the United States and China.

Zafir warned that today, Southeast Asian exporters face tough choices, not only commercially but more geopolitically.He mentioned that the United States has made it clear that it does not want its key supply chains, especially semiconductor supply chains, to be entangled with China's supply chain.

Tunku Zavr Zavr, Minister of Investment, Trade and Industry of Malaysia, Account X

Neither the U.S. nor China will block other countries¡¯ trade with each other, he said, but neither country wants its key technologies to be threatened.

As a result, Zaffr predicts that the "two kitchens" will no longer be a theory, but a "inevitable reality." He said that both the United States and China insist on separating their strategic industries from each other, which means dismantling the already inseparable global supply chain network.

Later this month, Trump will attend an ASEAN summit in Malaysia. The report mentioned that U.S. Trade Representative Jamison Greer visited Malaysia in September and conveyed a straightforward message in Kuala Lumpur that the United States will not give in on the goal of "regaining control of key industries," including the semiconductor industry, which has contributed a lot to the economies of Malaysia, Vietnam and Thailand.

On the occasion of Trump's visit, Southeast Asian countries seek to expand more diversified markets on the one hand, and also hope to maintain stable relations with China, its largest trading partner.

Roland Berger, a global strategic consultancy, said that as Trump¡¯s protectionism increases global uncertainty, Southeast Asia is becoming part of a new, rapidly-built supply chain centered on the region.

"Traditional global supply chains are no longer able to meet the resilience needs at the regional level," Roland Berger pointed out in a report released last month."Europe, North America and Asia are establishing independent systems to lay the foundation for a multipolar global supply chain."

The report pointed out that China has taken a leading position in establishing an Asia-centered supply chain, and has continued to strengthen economic and technological cooperation with Southeast Asia and deepen partnerships with Japan and South Korea. However, for small countries like Malaysia, the fragmentation of global trade poses a dilemma, especially as they seek higher value-added industrial chains.

Malaysia is one of the world's important semiconductor packaging and testing centers, responsible for about 13% of the world's high-end chip packaging and testing business, and is eager to enter the more lucrative fields of wafer manufacturing and integrated circuit design. But any move to strengthen cooperation with China's technology industry may trigger dissatisfaction in Washington.

During a visit to Malaysia last month, Greerly said the chips were critical to U.S. national security and threatened that regional manufacturers would have to transfer some of their production capacity to the U.S. otherwise they would face punitive tariffs.

¡°When we grow, we have to adhere to two sets of rules and two supply chains, both in the US and China, and we have no choice,¡± Zuckerberg said.

Chinese flag and American flag data map

Zafir, who has led Malaysia¡¯s trade talks with Washington since April, said his team was working hard to pinpoint the details of the deal before Trump¡¯s visit to Malaysia, which would bring ¡°long-lasting certainty¡± to the market.

According to an earlier agreement, the United States lowered Malaysia's commodity tax rate to 19%, but Malaysia must invest US$240 billion in procurement and investment in the United States over the next ten years, far exceeding the country's current US$25 billion in the United States. trade surplus.

In terms of trade talks with the United States, Zafir does not seem to have much hope.

"We never expected to stop Trump. No one can do it, not even Singapore,"Zaffr said. He mentioned that although Singapore has almost zero trade barriers with the United States and imports more from the United States than exports, it is still subject to a 10% tariff.

"What more can they give [the U.S.]?" Zafre asked. He added: "We have communicated with our (American) counterparts, and I think their boss's attitude is very clear. He will not give in easily or reduce tariffs quickly."

Chai, a professor at the Institute of International Relations of the College of Foreign Affairs and an observer¡¯s web column author, previously wrote that while U.S. trade protectionism has caused serious concerns and dissatisfaction in Southeast Asian countries, it is worth noting that since the Trump administration introduced a ¡°reciprocal tariff¡± policy, ASEAN countries have decided not to retaliate against the United States.

Trump administration launches ¡°reciprocal tariffs¡± policy

Cha Wen believes that on the one hand, the policy choices of Southeast Asian countries reflect the fragility of export-oriented economies; on the other hand, and more importantly, the policy choices of Southeast Asian countries reflect their strategic preference to flexibly follow the strong. Faced with the escalation of strategic competition between China and the United States, leaders of Southeast Asian countries generally emphasize regional neutrality and peace, and emphasize the policy stance of refusing to "choose sides" among major powers.

Chai pointed out that this highly sensitive to the transfer of power, the preference to ensure the maximization of their interests through foreign policy and alliance, is widespread among Southeast Asian countries. Singapore's father Li Chung Yuan said: "If the east wind seems to blow stronger than the western wind, then even before the wind comes, people begin to lean in that direction."

On the other hand, the flexibility of the countries in the region means that both China and the United States will find it difficult to establish a stable leadership position, and both countries will continue to win and lose followers.