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NIK ZAFRI BIN ABDUL MAJID,
CONSULTANT/TRAINER
Email: nikzafri@yahoo.com, nikzafri@gmail.com
https://nikzafri.wixstudio.com/nikzafriv2

Kelantanese, Alumni of Sultan Ismail College Kelantan (SICA), Business Management/Administration, IT Competency Cert, Certified Written English Professional US. Has participated in many seminars/conferences (local/ international) in the capacity of trainer/lecturer and participant.

Affiliations :- Council/Network Member of Gerson Lehrman Group, Institute of Quality Malaysia, Auditor ISO 9000 IRCAUK, Auditor OHSMS (SIRIM and STS) /EMS ISO 14000 and Construction Quality Assessment System CONQUAS, CIDB (Now BCA) Singapore),

* Possesses almost 30 years of experience/hands-on in the multi-modern management & technical disciplines (systems & methodologies) such as Knowledge Management (Hi-Impact Management/ICT Solutions), Quality (TQM/ISO), Safety Health Environment, Civil & Building (Construction), Manufacturing, Motivation & Team Building, HR, Marketing/Branding, Business Process Reengineering, Economy/Stock Market, Contracts/Project Management, Finance & Banking, etc. He was employed to international bluechips involving in national/international megaprojects such as Balfour Beatty Construction/Knight Piesold & Partners UK, MMI Insurance Group Australia, Hazama Corporation (Hazamagumi) Japan (with Mitsubishi Corporation, JA Jones US, MMCE and Ho-Hup) and Sunway Construction Berhad (The Sunway Group of Companies). Among major projects undertaken : Pergau Hydro Electric Project, KLCC Petronas Twin Towers, LRT Tunnelling, KLIA, Petronas Refineries Melaka, Putrajaya Government Complex, Sistem Lingkaran Lebuhraya Kajang (SILK), Mex Highway, KLIA1, KLIA2 etc. Once serviced SMPD Management Consultants as Associate Consultant cum Lecturer for Diploma in Management, Institute of Supervisory Management UK/SMPD JV. Currently – Associate/Visiting Consultants/Facilitators, Advisors/Technical Experts for leading consulting firms (local and international), certification bodies including project management. To name a few – Noma SWO Consult, Amiosh Resources, Timur West Consultant Sdn. Bhd., TIJ Consultants Group (Malaysia and Singapore), QHSEL Consultancy Sdn. Bhd.

He is also currently holding the Position of Principal Consultant/Executive Director (Special Projects) - Systems and Methods, ESG, QHSE at QHSEL Consultancy Sdn. Bhd.* Ex-Resident Weekly Columnist of Utusan Malaysia (1995-1998) and have produced more than 100 articles related to ISO-9000– Management System and Documentation Models, TQM Strategic Management, Occupational Safety and Health (now OHSAS 18000) and Environmental Management Systems ISO 14000. His write-ups/experience has assisted many students/researchers alike in module developments based on competency or academics and completion of many theses. Once commended by the then Chief Secretary to the Government of Malaysia for his diligence in promoting and training the civil services (government sector) based on “Total Quality Management and Quality Management System ISO-9000 in Malaysian Civil Service – Paradigm Shift Scalar for Assessment System”

Among Nik Zafri’s clients : Adabi Consumer Industries Sdn. Bhd, (MRP II, Accounts/Credit Control) The HQ of Royal Customs and Excise Malaysia (ISO 9000), Veterinary Services Dept. Negeri Sembilan (ISO 9000), The Institution of Engineers Malaysia (Aspects of Project Management – KLCC construction), Corporate HQ of RHB (Peter Drucker's MBO/KRA), NEC Semiconductor - Klang Selangor (Productivity Management), Prime Minister’s Department Malaysia (ISO 9000), State Secretarial Office Negeri Sembilan (ISO 9000), Hidrological Department KL (ISO 9000), Asahi Kluang Johor(System Audit, Management/Supervisory Development), Tunku Mahmood (2) Primary School Kluang Johor (ISO 9000), Consortium PANZANA (HSSE 3rd Party Audit), Lecturer for Information Technology Training Centre (ITTC) – Authorised Training Center (ATC) – University of Technology Malaysia (UTM) Kluang Branch Johor, Kluang General Hospital Johor (Management/Supervision Development, Office Technology/Administration, ISO 9000 & Construction Management), Kahang Timur Secondary School Johor (ISO 9000), Sultan Abdul Jalil Secondary School Kluang Johor (Islamic Motivation and Team Building), Guocera Tiles Industries Kluang Johor (EMS ISO 14000), MNE Construction (M) Sdn. Bhd. Kota Tinggi Johor (ISO 9000 – Construction), UITM Shah Alam Selangor (Knowledge Management/Knowledge Based Economy /TQM), Telesystem Electronics/Digico Cable(ODM/OEM for Astro – ISO 9000), Sungai Long Industries Sdn. Bhd. (Bina Puri Group) - ISO 9000 Construction), Secura Security Printing Sdn. Bhd,(ISO 9000 – Security Printing) ROTOL AMS Bumi Sdn. Bhd & ROTOL Architectural Services Sdn. Bhd. (ROTOL Group) – ISO 9000 –Architecture, Bond M & E (KL) Sdn. Bhd. (ISO 9000 – Construction/M & E), Skyline Telco (M) Sdn. Bhd. (Knowledge Management),Technochase Sdn. Bhd JB (ISO 9000 – Construction), Institut Kefahaman Islam Malaysia (IKIM – ISO 9000 & Internal Audit Refresher), Shinryo/Steamline Consortium (Petronas/OGP Power Co-Generation Plant Melaka – Construction Management and Safety, Health, Environment), Hospital Universiti Kebangsaan Malaysia (Negotiation Skills), Association for Retired Intelligence Operatives of Malaysia (Cyber Security – Arpa/NSFUsenet, Cobit, Till, ISO/IEC ISMS 27000 for Law/Enforcement/Military), T.Yamaichi Corp. (M) Sdn. Bhd. (EMS ISO 14000) LSB Manufacturing Solutions Sdn. Bhd., (Lean Scoreboard (including a full development of System-Software-Application - MSC Malaysia & Six Sigma) PJZ Marine Services Sdn. Bhd., (Safety Management Systems and Internal Audit based on International Marine Organization Standards) UNITAR/UNTEC (Degree in Accountacy – Career Path/Roadmap) Cobrain Holdings Sdn. Bhd.(Managing Construction Safety & Health), Speaker for International Finance & Management Strategy (Closed Conference), Pembinaan Jaya Zira Sdn. Bhd. (ISO 9001:2008-Internal Audit for Construction Industry & Overview of version 2015), Straits Consulting Engineers Sdn. Bhd. (Full Integrated Management System – ISO 9000, OHSAS 18000 (ISO 45000) and EMS ISO 14000 for Civil/Structural/Geotechnical Consulting), Malaysia Management & Science University (MSU – (Managing Business in an Organization), Innoseven Sdn. Bhd. (KVMRT Line 1 MSPR8 – Awareness and Internal Audit (Construction), ISO 9001:2008 and 2015 overview for the Construction Industry), Kemakmuran Sdn. Bhd. (KVMRT Line 1 - Signages/Wayfinding - Project Quality Plan and Construction Method Statement ), Lembaga Tabung Haji - Flood ERP, WNA Consultants - DID/JPS -Flood Risk Assessment and Management Plan - Prelim, Conceptual Design, Interim and Final Report etc., Tunnel Fire Safety - Fire Risk Assessment Report - Design Fire Scenario), Safety, Health and Environmental Management Plans leading construction/property companies/corporations in Malaysia, Timur West Consultant : Business Methodology and System, Information Security Management Systems (ISMS) ISO/IEC 27001:2013 for Majlis Bandaraya Petaling Jaya ISMS/Audit/Risk/ITP Technical Team, MPDT Capital Berhad - ISO 9001: 2015 - Consultancy, Construction, Project Rehabilitation, Desalination (first one in Malaysia to receive certification on trades such as Reverse Osmosis Seawater Desalination and Project Recovery/Rehabilitation), ABAC Centre of Excellence UK (ABMS ISO 37001) Joint Assessment (Technical Expert)

* Has appeared for 10 consecutive series in “Good Morning Malaysia RTM TV1’ Corporate Talk Segment discussing on ISO 9000/14000 in various industries. For ICT, his inputs garnered from his expertise have successfully led to development of work-process e-enabling systems in the environments of intranet, portal and interactive web design especially for the construction and manufacturing. Some of the end products have won various competitions of innovativeness, quality, continual-improvements and construction industry award at national level. He has also in advisory capacity – involved in development and moderation of websites, portals and e-profiles for mainly corporate and private sectors, public figures etc. He is also one of the recipients for MOSTE Innovation for RFID use in Electronic Toll Collection in Malaysia.

Note :


TO SEE ALL ARTICLES

ON THE"LABEL" SECTION BELOW (RIGHT SIDE COLUMN), YOU CAN CLICK ON ANY TAG - TO READ ALL ARTICLES ACCORDING TO ITS CATEGORY (E.G. LABEL : CONSTRUCTION) OR GO TO THE VERY END OF THIS BLOG AND CLICK "Older Posts"


 

Showing posts with label TRADE WARS. Show all posts
Showing posts with label TRADE WARS. Show all posts

Tuesday, May 13, 2025

US-China Trade Truce: A Strategic Pause or Temporary Relief? - Nik Zafri Analyzes

 


The recent de-escalation of trade tensions between China and the United States, marked by a mutual reduction of tariffs, is a major development in global economics. 

1. HOW

1) Negotiation Rounds: Trade officials from both countries likely engaged in extensive diplomatic talks behind closed doors, exchanging proposals and concessions. 

2) Agreement on Tariff Reductions: A phased reduction in tariffs was probably agreed upon, targeting key sectors (e.g., agriculture, tech, manufacturing). 

3) Public Announcements and Policy Changes: Both governments made coordinated announcements, possibly issuing official decrees or modifying customs schedules. 

4) Monitoring and Review: Mechanisms may be in place to monitor compliance and re-evaluate tariffs in case of disputes or economic shifts.


2. WHY

1) Economic Slowdown Risks: Both economies have felt the strain, higher costs for businesses, inflation, and supply chain disruptions.

2) Global Pressure: The IMF, WTO, and global investors often urge the world’s two largest economies to cooperate for global economic stability.

3) Political Calculations: Leaders may aim to secure domestic support or prepare for elections by easing tensions.

4) Supply Chain Security: Companies and governments want more predictable access to goods and materials.


3. ECONOMY

3.1 Positive

a) Trade Growth: Lower tariffs make goods cheaper, boosting import/export volume between the two countries.

b) Reduced Costs: Businesses save money on raw materials and components, improving margins or reducing prices.

c) Market Confidence: Investors view the easing of tensions as a sign of stability, boosting stock markets.

d) Inflation Control: Lower import costs can ease consumer prices, helping central banks manage inflation.

Global Spillover Effects

e) Revived Global Trade: Other economies benefit from more fluid trade routes and reduced global uncertainty.

f) Currency Stabilization: Less volatility in the yuan and dollar helps stabilize emerging market currencies.

g) Investment Recovery: Global investors may resume or expand investments in both Chinese and U.S. markets.

3.2 Potential Risks

a) Uneven Gains: Some domestic industries (especially those previously protected by tariffs) might face new competition.

b) Geopolitical Complexity: While tariffs ease, tech and military tensions may continue in other forms.


4. ONLY FOR 90 DAYS?

Whether the U.S.- China tariff de-escalation lasts only 90 days or becomes a continual process depends on several key factors:

4.1 If 90 days

a) Allow time for further negotiations.

b) Monitor initial compliance.

c) Defer harsher measures while assessing political and economic reactions.

Such a truce typically includes benchmarks both sides must meet (e.g., increased purchases, IP enforcement, transparency). If either side fails, tariffs could return or escalate.

4.2 If Continual

It will require:

a) A signed trade agreement or treaty with defined terms.

b) Long-term policy alignment on key issues like technology transfer, market access, and subsidies.

c) Mutual political will, especially through leadership transitions or election cycles.

If this current easing is part of a trial period, it's likely to last 90 days, with potential to extend. However, if both parties see strategic benefit, it could evolve into a more stable, ongoing trade relationship.


5. UNCHANGED TARIFFS

Automobiles & Auto Parts, Pharmaceuticals, Aluminum & Steel (Section 232 Tariffs)

These exclusions do still affect the economy, despite overall tariff reductions in other sectors.


5.1 Impact on Other Countries

 5.2 Global Trade Dynamics

  • Trade Diversion: Countries not facing tariffs (like Vietnam or Mexico) might see increased demand.
  • WTO Role: Allies may press the U.S. at WTO for consistent, rules-based trade policies.
  • Investment Hesitancy: Companies may still hesitate to invest if tariffs on key inputs persist.

Even with partial tariff relief, leaving out major sectors like autos, pharmaceuticals, and metals keeps significant economic friction in place. The global response (especially from allies) will depend on whether the U.S. extends tariff relief beyond China or maintains a fragmented approach.

 

5.3 Why Keep Tariffs on Pharmaceuticals, Automobiles, and Aluminum/Steel?

 

Trump argued that leaving these tariffs in place serves one core purpose:

 

To bring manufacturing and strategic industries back to the U.S. 


("If it's made in America, it's better for our jobs, our national security, and our

 independence.")

 


5.4 Can This Be Done Without Hurting the U.S. Economy?


Here’s where economists are divided, because while tariffs protect jobs, they also come with costs. 



Bottom Line - Can it be done without economic impact?


Not entirely. There will always be trade-offs.


But Trump's approach is to accept short-term consumer pain or cost increases in return for long-term gains in industrial capacity, jobs, and strategic autonomy.


It's a "rebuild-from-within" philosophy (protectionist), but aimed at revitalizing U.S. self-sufficiency.


5.5 Global Impact Matrix



6.0 THE 2019 “GOOD DEAL” THAT WENT SOUTH

I believe it's important to revisit the 2019 U.S.- China trade deal, during which both countries were engaged in months of intensive negotiations aimed at resolving ongoing trade tensions

US stated that it was “great deal” reached or was close to being finalized that would:
  • Open China's markets further to U.S. companies ("Open China" - which in the recent 2025 deal, China is said still thinking about it)
  • Increase Chinese purchases of U.S. goods (esp. agriculture and energy)
  • Protect U.S. intellectual property
  • End forced technology transfer for American firms
  • Include enforceable mechanisms to ensure compliance
In the final stage, US said that China revised key parts of the draft agreement.

They allegedly removed commitments related to enforcement, IP protection, and structural reforms (e.g., subsidies, state-owned enterprises).

Trump called this a “reneging” on a nearly finalized deal and responded by raising tariffs (e.g., from 10% to 25% on $200 billion worth of goods).

6.1 China’s Perspective (2019)

  • The U.S. demands were too intrusive, especially demands for changes to sovereign laws.
  • They wanted a more balanced deal, with tariff rollbacks included in exchange for concessions.
  • The U.S. side, in their view, kept shifting goalposts.
China was reportedly even during that time - willing to buy more U.S. goods, but resisted deeper structural reforms, especially changing domestic laws and accepting unilateral U.S. enforcement mechanisms

And with tariffs on key sectors staying in place, China may think:

Why make deeper concessions when the U.S. won’t even roll back current tariffs?”
 

6.2. Unchanged Tariff?

I think the unchanged U.S. tariffs on automobiles, pharmaceuticals, and aluminum/steel very likely played a contributing role in China’s alleged last-minute withdrawal from the trade deal. This was based on 2019 history:

During the trade negotiations, China expected that any deal would include:
  • Phased tariff rollbacks, not just a halt on new tariffs
  • Removal or easing of existing tariffs, especially those imposed under:
  • Section 301 (general goods from China)
  • Section 232 (steel and aluminum, affecting many nations including China)
But Trump’s position at the time was:
  • Keep key tariffs intact as leverage
  • Use compliance enforcement over time to maybe reduce tariffs later
  • Exclude items like automobiles, pharmaceuticals, and metals from immediate relief

This mismatch in expectations led to a breakdown.

The excluded tariffs were on strategically sensitive on China’s side


If these tariffs remained, China may feel that the deal lacked good faith or reciprocity.

While not the only reason, the unchanged tariffs on autos, pharma, and metals were a significant sticking point that contributed to the collapse of the draft deal. China likely saw little benefit in making deeper concessions when key U.S. tariffs remained untouched, especially on sectors core to its national interests.


7.0 DID PRESIDENT TRUMP REVISITED THE KEY ELEMENTS OF 2019 US-CHINA TRADE DEAL?

The answer is almost a big “YES”. President Donald Trump is revisiting key elements of the 2019 U.S.- China trade deal especially the parts he considers strong negotiating wins as a template or leverage point for his 2025 trade stance, particularly as he prepares for a possible return to office. Here’s how :

 


Possible Risks in 2025 if President Trump Returns with 2019 Playbook

8.0  HOW GLOBAL STOCK MARKET REACT 2025 (I BELIEVE IT’S A MIRROR OF 2019)

General Market Reaction to the 2025 U.S. - China Trade Deal (Based on What I Unqualifyingly Analyze)

a. Initial Optimism

Global indices did rally on news of a truce or deal - markets often welcome de-escalation in trade tensions.

However, I’m unsure how positive did the investors respond on the recent truce:

  • Did it really ease tariff threats?
  • Did it really restore global supply chains?
  • Did it really renew business confidence?

 Sectors That Benefit :

  • Tech stocks (Apple, Nvidia, Samsung) - less risk from tariffs or component supply disruptions
  • Industrial/export-heavy firms (Caterpillar, Boeing) - reliant on global trade
  • Emerging markets - especially those linked to supply chains or raw materials

b. Cautious Optimism or Flatlining After Details Emerge

The deal might still lack clarity or enforceability, and I see the markets started to show sign of cooling off.

Tariffs that remain (e.g., on automobiles, pharmaceuticals, or metals) have somehow limit long-term investor enthusiasm.

Personally, the investors and I feel that the deal being more symbolic than structural.

c. Volatility Based on Political Rhetoric

Markets may react sharply to statements by US or Chinese officials, especially if:

  • Talks break down again
  • There’s backlash from Congress, WTO, or domestic industries
  • Enforcement mechanisms are weak

Thus :


The 2025 deal mirrors earlier ones like in 2019, the market may be seeing:

  • A short-term bounce
  • Followed by sector-specific adjustments
  • Then we’ll be seeing cautious trading until implementation details are confirmed

WHAT I REALLY THINK

What I feel (don’t quote me), the deal did happened but :

Temporary Stabilization, Not a Resolution

The agreement represents a short-term de-escalation rather than a long-term solution. Structural issues in U.S.-China economic relations remain unresolved, and both sides appear to be buying time rather than genuinely reconciling key differences.

Strategic Motivations Behind the Truce

The U.S. agreed to postpone additional tariffs to reduce pressure on domestic markets and consumers, especially ahead of elections, while China aimed to ease the economic slowdown and regain investor confidence.

Global Economic Reactions Are Cautiously Optimistic

While markets initially reacted positively, uncertainty lingers as no clear roadmap exists for addressing deep-rooted issues such as intellectual property theft, state subsidies, and technology transfer demands.

Underlying Rivalry Persists

The truce does not mark the end of U.S.-China strategic competition. Rather, it shows a tactical pause amid broader geopolitical rivalry spanning trade, technology, and global influence.

Long-Term Outlook Remains Volatile

Without meaningful and enforceable commitments, the risk of trade tensions resurfacing remains high. Future negotiations will test the political will and strategic priorities of both nations.