Chinese solar panel makers close plants, scale back production in Malaysia as US tariffs bite | The Straits Times

Impact of US Tariffs on Chinese Solar Panel Makers in Malaysia

Several Chinese-owned solar panel companies have either shut down or reduced their operations in Malaysia due to increased US tariffs and anticipated further hikes. This includes major players like Jinko Solar, Risen Energy, and JA Solar, collectively responsible for nearly 40% of Malaysia's solar production capacity. Longi Green Energy, another significant player, has also halted its expansion plans.

Economic Consequences

This downturn affects not only the large firms but also smaller, Chinese-owned companies in the supply chain, leading to potential job losses (estimated at over 5,000) and decreased tax revenue. The Malaysian government is exploring ways to utilize the existing manufacturing facilities to support the country's renewable energy transition.

Geopolitical Implications

The situation highlights the ongoing US-China trade tensions and their impact on global investment. China's investments in Malaysia have significantly decreased, influenced by both US trade policies and the slowing Chinese economy. Malaysia's government is actively trying to attract other foreign investments to diversify its economy.

Future Outlook

• Chinese companies are likely to shift their production to other countries not subject to US tariffs, such as Indonesia and Laos.
• Economists predict a long-term shift by China away from the US market toward other rapidly growing regions like Southeast Asia and Africa.