China-based tire manufacturers are advised to set up operations in Malaysia to avoid the extra duty imposed on their products when exporting to the United States.
Malaysian-China Chamber of Commerce (MCCC) Liew Choon Kong made this remark here on Saturday in the interview with Bernama, the country's national news agency.
The United States recently imposed a punitive tariff of 35 percent on Chinese-made tires imported by the U.S.
The practice of trade protectionism by the U.S. has led to strong objection by the China-based tire manufacturers.
According to Liew, tires produced in Malaysia would not be classified as Chinese made, allowing the tire makers to save on taxes if their products were made in and exported from Malaysia.
Moreover, China bought a lot of rubber from Malaysia for tire production, elaborated Liew.
Liew noted that amidst the current economic situation, the move would create more opportunities for business communities from both countries to collaborate.
He also said local food and beverage producers could tap the large market in China, especially the exports of coffee, a product China found difficult to obtain.