Prime Minister Tun Dr Mahathir Mohamad with Institute of Strategic and International Studies (ISIS) Malaysia chairman and CEO, Tan Sri Rastam Mohd Isa (right) during the question and answer session at ISIS Praxis Malaysia Conference in Kuala Lumpur. -NSTP/Mohamad Shahril Badri Saali

KUALA LUMPUR: Malaysia is seeking to enhance collaboration with its Asean neighbours to cushion the impact of the US-China trade war, said Prime Minister Tun Dr Mahathir Mohamad.

A trade war between the world’s two largest economies, he said, is bound to fracture the world’s trading system.

Dr Mahathir said businesses need smooth planning and to avoid disruption.

“We need to build capacity by developing our competitiveness. We must also develop our own world-class companies that can take on all rivals.

“One way to achieve this is by identifying our assets and capabilities so as to enhance our capacities to take advantage of the new technologies; and then include the quality of our human resources,” he said in his keynote address at the ISIS Praxis Conference here, today.

Dr Mahathir said the US-China mega-trade war might be a symptom of something far worse – growing rivalry between the world’s two biggest powers developing into another Cold War.

“It is disappointing to see the proponents of free trade now indulging in restrictive trade on a grand scale.

“Unfortunately, we are caught in the middle. Economically, we are linked to both markets, and physically, we are also caught in between, for geographical reasons.

“There are even suggestions that we ourselves would be a target for sanctions,” he said.

Commenting on internal challenges, he said that one of the biggest currently faced by the government is mopping up the mess left behind after successfully toppling the previous kleptocratic regime and rebuilding the nation.

Dr Mahathir said for the country to recover and to grow, the machinery of government must be restored and made efficient by practising zero corruption. – Bernama