# Ft Fui K Soong: Is China Drowning? Will It Take the World Down with It? (Episode 33)
Published: 2025-12-05T07:26:59+00:00

## Summary
Sam Saad sits down with Fui K Soong, CEO of the Centre for Strategic Engagement, to analyze China's economic trajectory and challenge mainstream Western narratives predicting systemic collapse. They debate China's deflation, the property market correction, overcapacity dumping in Southeast Asia, and the inevitable macroeconomic shifts toward AI and new resource trade corridors.

## Key Takeaways
- [5:51] Western comparisons of China's deflation to Japan's Lost Decades overlook fundamental structural differences in sovereign debt dynamics and the Plaza Accords.
- [19:48] Over 90% homeownership in China insulates ordinary families from outright homelessness during real estate corrections, unlike the systemic foreclosure waves seen during the 2008 US crisis.
- [27:22] Aggressive internal market competition among dozens of EV manufacturers gives Chinese automakers an edge over Western subsidized single-champion strategies like Tesla.
- [41:13] Deflation serves as an unintended social stabilizer for Beijing by preserving consumer purchasing power and preventing hyperinflationary unrest while property asset values adjust.
- [50:30] US tariffs and geopolitical pressure have inadvertently accelerated China's structural shift away from low-end sweatshop manufacturing toward higher-value tech sectors.
- [1:13:10] Strategic overland pipelines like Power of Siberia 2 bypass vulnerable maritime chokepoints like the Straits of Malacca, securing cheap long-term energy supplies.
- [1:21:55] Systemic corruption and capital leakage represent the true growth ceilings for developing countries rather than external trade deficits or foreign market competition.

## Chapters
0:00 The $60 Billion Imbalance We break down Malaysia’s heavy reliance on China and the widening trade deficit that demands a strategic rethink.
4:10 Why China Won’t Be Japan 2.0 Debunking the popular "Western narrative." Why the Plaza Accords model doesn't apply to Beijing's deflation strategy and why comparing the two economies is erroneous.
6:40 The Youth Unemployment Crisis Analyzing the 24% unemployment rate and how an aging population mirrors Japan, even if the structural economy doesn't.
10:50 The Truth About the Property Crash Is the real estate bubble bursting? We analyze why 90% home ownership changes the stakes compared to the 2008 US crisis, and how the "bubble" was actually a savings vehicle for the average citizen.
16:40 Tesla vs. The World The brutal reality of EV subsidies. Why we believe the US is already too late to catch up with BYD and why Tesla losing subsidies might actually be good for competition.
23:20 The "Dumping" Dilemma How China’s overproduction is flooding global markets and killing domestic industries in Southeast Asia—and why nations like Malaysia are too scared to push back via the WTO.
25:00 Social Unrest & The CCP Why low prices (deflation) might be the government's best insurance policy against revolution, ensuring the average citizen can still afford life despite the property crash.
32:30 Moving Up the Value Chain How Trump's tariffs may have accidentally helped China force its industries to modernize and exit the "sweatshop" era.
36:40 The AI Disruption Will Artificial Intelligence save the economy or destroy the workforce? We discuss the looming wealth gap, the necessity of AI for a shrinking population, and the shift toward digital socialism.
46:40 New Trade Routes & Pipelines How China is bypassing the Straits of Malacca and maritime choke points by building energy arteries like the "Power of Siberia 2" through Russia.
52:30 The Ultimate Enemy Why corruption, not economic policy, is the true ceiling for developing nations like Malaysia, and why leakage is the real enemy of growth.
55:50 Teaser: The Malaysian Chinese Shift A sneak peek at Fui’s upcoming book on the shifting dynamics of the Malaysian Chinese community and their strategic minority status.

## Transcript
[0:01] Good day everyone. Welcome back to the Gutshot podcast. I'm Shamsul Sam your host and here we have today to talk about the topic of the day. We're going to go to um my friend who's the CEO of the center for uh strategic uh the center for strategic u engagement. Yes.

[0:22] Sense. Sense. Exactly. um and uh to figure out uh uh I think or update and and and figure out the current situation um in China uh and how it impacts the region uh what's going on domestically there how it impact the region how it impacts visav the dynamics of the geopolitics and economics within its supply chain throughout the world including the US and uh well Russia uh um especially with what's going on um and um and make sense of it. Uh so uh fuy let's start with this uh for

[1:08] my data set looking at the numbers that I see number one um our Malaysian export to China works out to approximately 40 billion US that's almost 10% of uh our GDP

[1:28] correct um on the other hand their export to Malaysia here is uh is so is is uh uh is about 100 billion I believe. Yeah. Um which means that I mean obviously they have a a surplus on us. Um but from a standpoint of um uh supply chain

[1:57] that becomes a very dependent relationship. Yeah. Yeah. We all know that 30% of the world manufacturing is uh dependent on China. Um in excess of 90% of uh rare mineral production is China um throughout the world from their various uh mining and production facilities. So just setting the stage

[2:26] um with respect of how China is so integrated within the the world economy. Yeah. What then uh comes to mind at this current moment? We've just passed the political fourth platum of uh the CCP uh which was highly anticipated.

[2:45] So we may want to talk about that slightly. Mhm. Um the concern seems to be that there seems to be uh deflationary uh impact on the Chinese economy. Uh let's do that as a as a starting question.

[3:06] Sure. Sufi, where do we go from? What what do you see? what's your uh what's your analysis at this point uh on on what we are looking at?

[3:19] Okay, I think you're talking about two different uh things here. I mean in reference to the export numbers for sure. I mean we are coming into a surplus a trade surplus or rather a a trade deficit with China.

[3:33] Uh that is mounting. Yeah. Okay. simply because we do not have the the the the kind of capacity and I think most countries can't right compete with China on on capacity manufacturing capacity and that is a concern that is definitely a concern because that in in in fact if you compare to the the numbers uh that we've always enjoyed with America and also the FDI numbers you will see that you know things are actually reversing. Yeah.

[4:02] Right. So it it does spell trouble for countries like our ourselves. Okay. If that is not addressed. Now coming back to so there's two different things here. So yeah because yeah so yeah so for so so for Malaysia

[4:19] definitely there has to be a rethink on how we're going to uh approach China and I think is is also an indication. Uh I just came back from Indonesia right? Uh, Indonesia also has the same problem, right? When you go down to certain areas, especially in uh in the Chinese areas and no dog and here we go to Sri Pataling or whatever, you see all these hot pots, uh, restaurants, uh, outfits, they're all dominated by China Chinese.

[4:48] Right. Right. And really seemingly taking over the local localmemes. Right. Right. So which is why Indonesia was so concerned about uh having you know Tik Tok and all that kind of thing on uh they have taken away the the the Tik Tok shop right simply there was just so much goods coming in from from China that's overtaking the local manufacturers so that is not a it is a an issue that is not uh not uh unique to Malaysia but I think we have a little bit more buffer. Singapore and Malaysia has a little bit more buffer simply because we we were ahead of the curve compared to say

[5:34] countries like Cambodia or uh Laos for example, right? But then again uh it is do I have a solution for that? No, I don't. But to in to then come back to your question on China's inflation

[5:51] not inflation I would say deflation sorry deflation I mean the inflation rate or deflation rate if if you if you like um I don't I mean what does deflation mean where where is the source of deflation in in China okay you you got to look at the source first now compared to Japan I think a lot of people are using the the same model, Japan went to a deflationary uh situation after they signed the Plaza Accords. If you remember that Plaza Accords with America where America then suppressed the Japanese in in many ways suppressed the Japanese manufacturing uh uh uh

[6:38] sector. Okay. So you remember if you remember there there were guys smashing Toyotaas and all that kind of thing in Washington. I don't know if you remember that but I I I do remember those days. I do remember the bailout of Chrysler and

[6:52] all that kind of thing. Yes. I I don't know whether they they Yeah. So the situation the source of de de the deinflationary pressure uh from from Japan was largely to to limit the manufacturing capacity of Japan and also to manipulate the bond market in order to prop up the US dollar. Okay, stabilize the US dollar and the Japanese bonds has always been used for that. You know

[7:21] that is why you have Japan is the largest borrower of uh uh um uh largest largest uh credited buyer of uh US bonds after after China.

[7:34] Uh no China is still second. Okay. China China is about 700 billion. I think uh Japan is about 1 I think it's still 1.3 1.4 bill trillion anyway. So I think the situation is very very different and if you ask a ordinary uh Chinese person there is deflation. What does deflation mean? Deflation mean that for the same buck I'm actually getting more. I'm actually getting more. Now how is that bad for me as a consumer? China also has the lowest the lowest electric uh the uh household household electric uh rates in the world. highest being UK and if and if you remember Samuel I I

[8:20] think taking deflation or inflation as a benchmark is uh I think for an economy as complex as China I I I think it it is probably uh one of I feel the biggest blind side that a lot of western analysts take on when they say oh yeah okay China is imploding because it's deflationary and it's like Japan uh if you remember Our Malaysia when we were going through our fastest growth in the '9s, our inflation was near zero and we had huge I mean people had so much money in their pockets. People were buying. Why? Because productivity was rising. So the same thing with with with with

[9:06] China. What they what they are actually looking at is how to keep how how to keep prices stable relatively cheap for their people while you improve productivity by robotization and so on and so forth. So all this thing about housing crisis, uh, China somehow running out of people. I don't know how you run out of people, but in China, I think you you're looking at a a modeling that is doesn't doesn't doesn't apply into it in in that situation. And I'm not saying that China has is is not without its uh its its problems. It does politically and economically. uh there

[9:46] is a high unemployment rate amongst the the the youth especially the the educated ones. Um yes, there is an over capacity which is why you see the tax revenue. Uh yeah, there's definitely a margin squeeze. Okay. And and and Trump's uh tariffs are not uh not without its uh impact. whether it's the desired impact to actually cow China into doing what they wanted uh how what they did to Japan I think that would be that would not be possible because of China or because China already saw what happened to to to Japan and they say okay this is this you're not doing that

[10:24] to me so which is why uh they've used the Trump trump card but of course then the other the the other question is how long will it take before

[10:36] American Can American catch up? The Americans uh catch up. So I'll leave it as that and then we'll we'll go on to other questions. So that's how I I I think it's very erroneous to see uh deflationary pressure and and uh what's happening in China as equivalent to to to what took place in in Japan. I think they're two totally different circumstances. I think um this is as as we've always said on on Gutshot, we are having conversations, right?

[11:07] Yeah. Yeah. Yeah. Yeah. Um and our conversations can have different point of views and different analysis. And that's partly how uh I wanted to um to carve out Gutshot different than any other podcast out there, which is we analyze

[11:28] together. And here's where I think we may differ. When I when I come about on deflationary, I'm not just looking from the point of view of inflation, right? I'm looking at a deflationary impact on the economy as a whole. Um, as you mentioned, number one, youth unemployment and they have a big youth uh uh population uh is a huge concern. They are in excess of 24%. Uh you've got uh an aging population going along with that. So that to a certain extent mirrors a bit of Japan. Okay. Um what Japan does not have you mentioned um the the courts that Japan went through

[12:24] um was plaza plaza court. Yeah. In the 19 I think it was 1990 19. But regardless the whole deflation I mean the whole stackflation let's I I think that's a probably the

[12:40] for about 20 for about 30 years for about a generation almost 30 years yeah because I when I graduated I worked for a Japanese firm right and uh and uh this was in Australia and then they they they really virtually imploded and just they were buying real estate in Australia left right and center if you remember

[12:58] here here's the thing that I I see um um the difference and um Japan uh at that particular time in the '90s had a per capita GDP if I'm not mistaken in excess of $30,000 US.

[13:15] Oh yeah. Yeah. And that is um that is beyond I mean that that is already quite a rich country. Okay. Uh the China on the other hand uh we are look looking at a per capita GDP at present uh some numbers put it at 12,000 uh

[13:42] about that 12,000 yeah some put it at 13,000 on the high end right so that is after inflation right so you've got two levels of in terms of uh the how much the individual individual population

[14:07] Yeah. actually have money in their pocket. That's one. The other thing that I saw and it's a big is that u the property speculation uh in Japan were mainly business and corporate. It's not individual. It's really not at a population level. Whereas in China, the property bubble was fueled by the average Joe down the street because it is a um uh uh a form of savings or investment on their part and that bubble has practically burst. uh production capacity with or without something without or with or without Trump

[15:00] coming into office this year right it was going that way already manufacturing capacity was already going uh that way which means that I mean they've already become the producer of uh the world 30% of production of the world manufacturing comes from China way before Trump comes into office that never was the issue with Japan. Right. So, um and I I think our last conversation I I've already said I I I had my big concern which is the the economic planning in um in in China is very dispersed

[15:43] in terms of how it is handled which is a good and a bad thing. a good thing in the sense that I think that's more capitalistic and um uh and and what do you call and self-generated at regional level.

[16:01] Yeah. Right. And that's why they succeeded very well with the dangra formation. However, there is a also a limit to that in a sense that there's a tipping point where actually when everybody is chasing growth

[16:17] and allocation of capital is unfettered by uh by your balance sheet or your P&L because you are a one party system. um that is what I think caused an overbuilding of infrastructure and an overbuilding of construction. So I mean this is this is

[16:41] this concerns is where maybe maybe I I mean I what what how do you how do you view that? How do you how do you this is something because it all premise Yeah. Shams it all premise on how you look at uh the numbers and how the resources are being applied in in China whether it's good or bad.

[17:03] Yeah. Going back to the property, I think this is again, you know, deflationary inflation uh uh uh population collapse uh property market collapse seems to be like three four pointers that I I I find a lot of uh western economists hang their analysis on on China and say okay so this is this is why we should be concerned and I I think I think it is it is mis misplaced. I mean it has uh maybe perhaps either it's a it's a it's a because it doesn't suit a certain narrative or it's you know so so I I tend to to to to move away from that and rather I look from the viewpoint of the Chinese people

[17:47] themselves how they see their economy and how they they they are they want to drive their country and how they they see the the world. Okay. Coming back to you know property speculation. Uh I remember like I said when I first uh graduated when I was in Australia I was actually working for a Japanese firm and I remember at that time in the 80s Japanese were buying real estate everywhere New York, London uh and I believe Japan and apparently you know even just in in you know just around where where the Tokyo Palace is in in Tokyo the price of the real estate the

[18:22] value of the real estate was something equivalent to the whole of California you know something really really really ridiculous. inside that. So therefore there was a um a bubble. Mhm. What China did as a country was with the savings that they with the surplus and the savings that they had they started buying resources Africa, South America and they invested. Some went good, some went bad, but they didn't you don't you don't see big corporations buying real estate like the Japanese did. They they may buy, but not speculative. Coming back to speculation at the ground

[19:05] level, I agree with you that was that was what was driven uh in many ways because China doesn't allow people to speculate in the stock market because they don't want the economy to be financialized which means it is going to hollow out the uh manufacturing and then money is going to be put into the stock market like New York Stock Exchange, right? So the wealth is actually focused on Wall Street. They didn't want that. So they wanted people to save. And then at that time the property boom in China seemed to be the way to save your you know

[19:48] it's a very traditional thinking that we used to have as well. But the thing is 90 you see it's different from when you say oh property collapse oh people are going to be on the streets. But it's is not like that in China. 90 odd% of people in China have uh own homes compared to 60 odd% in the United States. Right? So it it is two different things. People who got hurt were the speculators for sure. And people have been talking and the and and and the the the the market when it cracked when the bubble burst in 2020 was right at the middle of the pandemic because people were they can't

[20:36] be going to you know houses and things like so you you had the property collapse that was 5 years ago. Okay. So it's a it's a it's a to me it's a slow release but doesn't mean that the problem has not gone away. And I and I feel that the the the way the the uh the central well the way China does it central planning it it is definitely not perfect but it has worked for them you know uh and I don't think if if people are are looking at China and think oh okay we're going to see a collap yeah yeah I think there's going to be correction it's going to be a very tough

[21:19] you know they are reckoning five six years but I don't see you know I I people in China and again I'm looking it from the other way I mean I first went to China in 1989 1990 when Samjan was just a you know a fishing village now it's still in people's living memory today in China they do remember those days now is China how bad is it going to be are we going to go back to the 1980s that that's how you know what I mean or you got to look at how people measure and see themselves

[21:57] uh in the scheme of things how bad is it going to be I I'm looking at it more from a macro standpoint because why in essence when I um when I evaluate or I do an analysis um I'm I'm really pure I'm really looking at the macro. I don't think as what you just said

[22:23] that things are going to revert back to the 1980s. I I don't see that ever happening. Yeah. Okay. Um what is of what is of real concern um is actually you know the ding reformation has been a great success for China and that went um for uh what almost what three years yeah three decades 1989

[22:53] right so um and then I think like with any I I I am um it's not the western narrative that I'm looking for. M I am a guy who I look at things from what I see happens in developing countries and I still consider if you look at China GDP per capita uh at 12,000 right that's about where we are actually that's about where we are

[23:26] for 1 billion for regardless irrespective for a 1 billion that shows for a 1 billion population um that shows the scale the scale of the improvement, right? Okay. But when you go to when I I always say when you move from from from agrarian uh uh agrarian economy into an industrialized economy, you're basically moving uh you you've basically jumpst start uh a productivity growth of double digit immediately as it goes because 50% of your population including women are going to start working uh into uh into a a a productivity uh a high productivity sector which is

[24:15] industrial. Right? So that has always been to me from an economic standpoint has always been a given. Any nation that goes from agrarian to uh industrialization is going to see double digit growth. Okay. How well it gets there uh depends on policies. So you have to give it to China. They have done extremely well for the first three decades of that particular reformation. Okay. We went through double digit growth as well. Um until uh we had one party system where the leadership decided that they would rather uh they would rather be uh be concerned about their place in power

[25:06] than uh than um than than actually moving the country beyond uh what it is. and and and if I were to put any lessons for Malaysia, Visav China is that we start building up GLC's which in China is called S so right um stateowned entity you know um to now compete with the private sector right so the private sector itself took a backseat um and this is there are so many issues actually when I look at it that to me it's almost like I'm not looking at a western narrative. I am looking at my comparison in philosophy and in terms of economic u uh uh economic execution.

[26:01] I couldn't agree more with you on the GLC part. I I think it's about time that our GLC's uh compete with the private sector because there has been significant significant crowding out of the private sector in terms of uh the way the banks lend to a private sector versus the way they they lend it to GLC's because it's some political directive that comes down from somewhere uh you must you know do it this way or whatever you know so I That one I completely agree with you. I think if there's any any any sense of improving our productivity, improving the way we compete, our competitiveness,

[26:43] that that has to be the way to go. So I'm looking at it going back to China. Basically what I saw was sorry I I want to go back to China because I digressed my my okay this one. So coming back to China, I think the competition between the provinces are as it's it's almost like it's almost like a another country versus a a different country. The way they compete on things they are they're very very competitive. That's why you have so many hundreds how many brands of uh EV cars and only maybe now today only a handful has survived. BYD of course uh Zika on the luxury market

[27:22] uh and Xiaomi and and and and and probably going to be a handful but there are plenty and pl plenty of of of brands it's not just one Tesla you know whereas in America is actually an antithesis of of of what they believe in capitalism is that they funded Tesla because they believed in one thing okay and they went with went with one all the eggs in one basket and I I don't know if Tesla is going to even be able to compete No,

[27:47] I would I I I I think to me when I look at let's say Tesla for example, I don't see Tesla for uh uh or uh or as an American company because the way I look at American capitalism is actually they just go out and whoever whoever uh

[28:09] Yeah. But the point being is that you know uh uh uh uh Tesla was was subsidized SpaceX is subsidized otherwise it won't be able to compete. Well put it this way I already said that actually

[28:21] it is not going to Yeah it's it's to to I mean iPhone for example but let's put it this way isn't isn't all the renewable or or EV companies subsidized all over the world including China?

[28:36] Yeah but then there is competition. Well, there goes you you you see what I mean? So, just like our GLC's, I think there should be competition. Well, here goes my point on that. Actually, no, here goes my point actually. I I don't think that I I don't think any of these industries should be subsidized.

[28:53] If you ask me, I don't think Tesla should be subsidized. I don't think BYD should be subsidized. None of these EV companies should be subsidized. Yeah, but who are we to say that that model is wrong for China? It worked for them. And the same goes that I think Tesla should never be subsidized. And I'm so glad to see actually that Trump is pulling the subsidies away. You go and compete then again then

[29:18] but it won't but it's already too late. Yeah, but it's already too late. Somebody's got to do it at some point. Yeah, it's already too late. I mean for I think for as far as EVs are concerned, it's already too late for America whether you're going to pull the subsidy or not. Well, at the end of the day, I'm looking at Well, then then it goes to that over production situation that we face, right? the the world is seeing over production. Okay. it impacts China over uh in a sense that because as you rightly put when you first uh when we first open up this conversation that the

[29:54] um that 30% of manufacturing production is China for the world right almost every country that we can think of are on trade deficit this is not a sustainable model. No country can have trade deficits with every other country on earth and sustain that model um visav their trade uh partners. I can't see that being sustainable.

[30:31] How long did the British Empire have a trade surplus with the rest of the world? That's the difference. The difference is that part of the century and it collapsed the

[30:43] Yeah, it does. It does. But then, but then how long did it last? Yeah. But you know, you know what I mean? It's not going to be tomorrow. I'm of the opinion that actually when I look at the long arc of history.

[30:55] Yeah. Um, technology and economy has shortened every cycle. the the the further we go back to history, the longer the the empire stood.

[31:08] You know, the Roman Empire was thousands of years old, right? And then we get uh the and then we get the Mongols, we get the uh Islamic Empire, the Ottomans, everything become shorter and shorter because of technology uh be and technology and commerce become making the world borderless.

[31:33] Yeah. But I just don't think that it is going to be the property market and the deflation that's going to collapse China. I'm not looking at collapsing the the the way you put I I think we're talking about two different perspectives here. I you know I mean yes China will collapse one day.

[31:49] No, it's not a matter of it's a matter of cause of history if you want to put it. I'm not I I I wouldn't call it a collapse. I I never use the word collapse. Okay. what what I use the word is the the use of the word that I I I use is basically uh if I don't talk about stackflation it's almost like the way I see how uh America was going um uh especially after the second Obama term

[32:19] right um what I saw was um a hollowing out of manufacturing it's a different problem in America right yeah a hollowing out of manufacturing and I think China learned from that which is a hollowing out of manufacturing

[32:34] which is why they're holding on to it and and and then money going to the uh capital market and the same goes with UK and uh to a certain extent Brussels as well which is everybody in reliance of the capital market as being the growth

[32:52] uh for the economy rather than manufacturing now they're paying the price for it y yeah and the only country actually for better or worse uh in spite of his sharp elbows, I do think that Trump is making a go of turning around what I consider a chapter 11 America,

[33:11] right? Um uh being involved in the corporate sector um I understand chapter 11s are chaotic. Okay. Now going back to China when I say I don't see a collapse what I am looking at is actually a concern that actually if you are about to drown in that sense right

[33:37] Japan drowned um in the '9s for 30 years okay they didn't die they did not die absolutely they did not die if it's not a no if it's not a collapse so then it's a correction I mean in econom I mean in economic language

[33:54] but this is the difference. Okay. You know what I mean? I'm using economic terms here. Okay. Let let me let me move let me move to where I think we we probably have about the same uh

[34:08] correction. The same it's not a collapse. Let's the same the the the the uh what do you call where where we find the ground and then we we move from there because why

[34:20] um it took China 30 years of correction so to speak they didn't quite die I don't I it doesn't they didn't quite die I don't think 30 years of cor I don't think that's a correction Sam so it is a 30 years of growth of building up a foundation correction ction means you grow. I mean economic go economics go correct me if you see so say correction it's a complete like you said it's an it's a mega shift from agarian to industrialization that's not a correction

[34:54] no no but but then when they they went through stackflation so they you're talking about Japan or I'm talking about Japan sorry sorry okay sorry because we were you know I'm just I'm just I'm just using Japan as a comparison first okay So I'm taking I'm taking what happened to Japan. Okay. The difference is I think Japan as when it hit its situation,

[35:20] yeah, it was already relatively rich. And if you add up the uh add up the the the the inflation uh for the the monetary inflation, they were beyond that $30 if you go by the dollar today. Okay. So we are looking at what's happening in China now with a few I think structural issues that are of concern. What are what

[35:46] no what are the structural issues that are of concern? I mean let let's be specific and then address one one by one. Okay. I think I' I've mentioned one I've mentioned one that the savings went mostly into actually domestic uh uh what do you call uh do domestic over production of construction into property okay one second I think the um the the overbuilding of uh of infrastructure okay it looks impressive okay but then what is happening like you rightly put you've got regional uh expansion because everybody is is is is uh is on their KPI. Every CCP official of every region

[36:34] need to show that their GDP is uh is is at that rate that actually they are building and building even if the the P&L and the balance sheet doesn't show uh uh the results. Okay. The other part that that actually is it becomes a problem for the world as well is the supply chain is so dependent on China and also that um and that the world cannot consume that much production from China. I mean I've seen solar uh renewables uh EVs going below cost uh to the world that there is a backlash now I frame that. Okay. So there is where I I I add another problem which is actually

[37:27] the only way they can they are also uh having to manage this issue is to export that particular model and it's going through the region. You just said that actually we are getting all these very productive, very efficient uh industries that are coming to our country totally China.

[37:50] Yeah. And probably killing out our domestic industry. Yes. I I think you're Yeah. I because I think you're conflating so a few things together. I think one like let's look at Yeah. Yeah.

[38:02] Well, interviewing you're talking too much. It's a conversation. I know. I know. I'm I'm just joking. I mean we we are both friends. Okay. So I mean this is Yeah. So I want the structure. Okay. I think I think few things. I mean we come back to what is China's policy makers nightmare and and and and what is our Malaysian policy makers nightmare? I I let let's they're two different things, right? Yeah. They're two different things because we one one is good for the other or one is actually bad for the other. We we don't know yet. Okay. But it looks like it's

[38:42] the latter. Let's address China first. Okay. Please. You're talking about s I I I agree with you. You know, when the bubble when the China bubble burst uh property market burst, I think a lot of people extremely angry, right? to a point that there could almost be could have been a almost a revolution because yes people been working 20 30 years you know hardearned money and everything put in property why because they were told to put into property they were told that that was the best investment uh that's how you protect your your nest egg uh and but to me I think that danger for

[39:27] the CC CP is uh I think that that danger point is pretty much over now you know as as as uh if you if you want to talk about you know a concern for policy makers

[39:40] simply because as I say that's why deflation uh if anything that kind of helps to calm down the issue. So imagine if you had lost your so-cal significant amount of your savings 70% of your savings

[39:54] and then plus and then plus you have you know inflation of uh 7% or 10 or 12% you know like in Russia I think that I think you could have a very very volatile situ social unrest in in China today and that hasn't happened because because simply because prices are are managed right are managed so people are seeing the purchasing power going up not going for a cup of coffee, they're actually paying less today. So, it's a good thing. It's like what we went through in the 80s and 90s, you know, pajamas. I remember when we when I was studying in Australia, I remember buying clothes

[40:29] from Target and things like this, uh, it was really expensive. But then back in and then in the 19s and 20s when when China started dumping pajamas and and bed sheets and all that in Australia everything was just you know lampshades and things like furniture just it was it was it was like new furniture I mean people had to buy secondhand furniture back in the 80s you know

[40:52] now people buy new remember that right people actually right now the furniture are so cheap I couldn't believe you can't yeah you cannot believe it back in the days so this is what's happening in China right now. So that for I think for the CCP for the central government what is really really important for them is managing social unrest

[41:13] and inflation from a Marxist Lennis school and economics viewpoint that is the very thing that they in their mind that is prime whether you agree with it or not they see dynasties collapse. Why? because always running inflation when goods become unaffordable for the people

[41:36] that is when you and that's how China sees it because they see it from their viewpoint of their own history right so I think in that sense I feel that I I think it's a little bit too presumptuous to assume that a collapse in the property prices coupled with deflationary is necessarily a bad thing from a Chinese economic policy viewpoint. It is not ideal. They rather not have the problem. But I don't see that as uh I don't I don't get that they feel that it is a serious issue anymore. Can you address uh the concern on um on being the then uh when your prices are so depressed

[42:37] because of over production that your margin is we are looking at about I think the last data because it's very difficult to look at data in China it it's so difficult you only take data I mean you take the best way is to take the government official data. That's all I'm doing.

[42:55] Yeah. So, if you agree that what's happening in China is not a collapse but a structural correction. Then it's a correction. It's something that they have to do to derisk. And what how they're doing it. Uh this is where it concerns us as Malaysians and as non-China is that they are dumping stocks. It's it's a classic dumping strategy,

[43:18] right? We should have Yeah. But we are not able to say it's anti-dumping because uh China is not a um I think under WTO they're not a fully um developed economy nation.

[43:32] Well if I'm not mistaken so that has to be addressed and I think that is being addressed. I think that has to be addressed. Yeah. So once that is addressed and this is how we and that's where we should be lobbying as a but then we dare not because why

[43:48] we're scared of each other. because we're scared. Okay, we dare not we dare not do that. So, but that is that is the crux of matter. If that is what it what it what China is doing to try to solve its own problems, which I I okay, from their viewpoint, they're doing the right thing. Okay, my people, you know, all that kind of thing. Yeah, but it is hurting us. So, on the flip side, we dare not because like you said, 40 billion a year is a lot, right? is for it's 10% of our GDP. My god.

[44:20] Oh yeah. Yeah. Exactly. Yeah. So um yeah that's a dilemma. That's a dilemma for us to resolve. So a so I I I don't I I don't I I don't see that as a major concern of of the China economy because I I think they know what they're doing. It's us that scared. I mean, that's basically where the problem lies because it's not us that's just scared because uh I mean we've got now uh I mean they used to be the saying, right? Um when America uh catch a cold, you know, everybody else gets sick. Now we've got two economies. If China uh if if China have a sinus, we probably going to have Lu,

[45:14] you know. No, we're going to have COVID. Yeah. So, um and and and the biggest uh and I mean when your population is is as big as their population is bigger than the whole of Southeast Asia, right? Um and their production is um well as I said you are talking about you know more than a quarter of the world right um there's only so much so many markets that can take that that production

[45:55] okay um their their strategy is is I think the they they see the problem I think I think what you're saying is is not something that they say Oh yeah okay okay you know no issue I don't I don't think there are solution for that especially

[46:10] oh the solution is very easy the solution is I go and buy up because I've already bought so many resourcerich countries right for example you know uh Africa and so on I bring back resources I it's a classic it's a classic capitalist uh uh model right I mean that's what uh Britain did to ch uh to to India bring back cotton produce cotton sell back cotton to to to India. Simple. I mean in a in a very classical

[46:40] classical capital capital world. I mean you know that was it Adam Smith's model. Yeah. You go you go and go and get Ros that's exactly what they're doing. So and in order to soal not be accused of exploiting the lesser world, they you know they they built bridges for you. They built uh uh uh

[47:01] not for free though. No, you're not. Of course, it's not for free, but you know, that's the that that's how it's done. I think they they've for as far as China's concerned that they're not doing anything different that is immorally, you know, immoral.

[47:18] It's I I don't view the world to be honest with you, from my point of view. I guess I guess I'm a less sorry guys. I guess I'm a less empathetic fellow from a from a from a capitalistic standpoint. I just look at the world as what it is.

[47:35] Yeah. They're just using the same game. I mean, I I you know, it is it has been played before. Yeah. Just that it's just that they they I'm trying to make sense. They they don't they just don't put, you know, guns in your doorsteps. I mean, well, not yet anyway.

[47:52] Unless unless you unless you're running the Philippine boats at the Yeah, something like that. I mean, at least not yet. So in that sense they they I mean China then just claims you know some moral high ground says look we are trying to and their strategy is very simple prosper thy neighbor you prosper yourself.

[48:15] Let me um at at this point I I'll take a short break. I want to tell the audience uh viewers um if you like this conversation um geopolitics or domestic uh issues on policies and analyzing things that we have over at Gutshot and going straight to the point as what we are doing right now.

[48:37] Please like subscribe so that you know you will get um you will get the YouTube algorithm coming direct to you as soon as a episode drops. Yeah. Okay, we'll continue. So, now here's here's here's the thing.

[48:53] Um here here's the thing that um I am still personally not as convinced as you are in terms how they're going to be able to manage.

[49:06] Um I see the latest month-to-month data this year, especially in terms of government revenue. Y uh it's all in single digit. uh in March they put in uh they put in um uh additional taxation in order to uh provide revenue uh from uh for their for their fiscal uh budget um uh expenditure. Um and that number um originally spike up you know um to a higher digit and it's come October it's gone negative. Um so I am still I still have question mark um in spite of what you just said with respect to structural reforms. um more because I think uh and I still think that the the the

[50:09] model um I'm not sure how much you can control the model at regional level when the main incentive is building as much as you can uh from the normal stand people's standpoint it's it's got I'm I'm not assigning any morality to to what I'm saying.

[50:30] I I know what you're saying. You know, uh I think there is there is definitely I I don't think I I deny or no the nor the policy makers deny that there is an over capacity a manufacturing overcapacity uh in China. I think what they they they one they're addressing it because I think I suppose the good thing about Trump the Trump tariffs are that it shocked the system. It woke up China and said look we need to do something about this. And I think one one way to bridge it from a Chinese policy makers viewpoint which is bad for us is okay dumping right until until and unless we are

[51:10] but they were already dumping don't you think before the Trump tariff they are they were they were so why are we not doing about something about it like I said WTO one of them is like you know we we we should take them to task right under WTO okay now it didn't happen but Trump came in and this is what happened so Now they're going out and okay uh I buy resources from you I I sell you manufactured goods. That is to me their stop gap measure. Right now they're desperately trying to move and this is how I see it. What they're trying to do is they do realize that I think eventually

[51:45] you you cannot continue to manufacture like forever. You can't. So like most developed countries do they move into the service sector and they move into high-end manufacturing and that's where you see Teslas and the Apples and the phones and all that probably going to India and and Bangladesh and places like that. this what I think under Cing Ping if I if I'm not mistaken about 10 years ago they were already moving what you call dirty uh industries out you know sweat shops uh Nike the Nikes and the the the all that he has always wanted to move that out way about 10 years ago when he first

[52:28] came in he says China has to go high-end but as entrepreneurs easy market I sell to Target I sell to Walmart I sell to you uh saintsbury you know it's so much easier right rather so I feel that this is this the Trump terrorist is something that the policies are not necessarily unhappy about you know to move up the value chain to be honest

[52:53] well it's forcing them at least to yeah it's forcing them to to move move up the value chain which is what what the part of the CCP plan of 15 uh uh plenary 15 year plan

[53:06] the fourth Five year five year plan. Oh my goodness. Which is like what 2027 is the something like that. But they've already achieved it like you know five years you know already. You see that's the thing you know with the Chinese they they think in centuries. But anyway uh what I'm saying is that that moving out of the low end is something that was that that was something that the central planning planners were trying to do even way before Trump came. And another thing about Trump, the way he went in all guns blazing and everything, I think that's a gift to the CCP.

[53:45] Suddenly everybody says, "Okay, I'm going to manufacture. Although my margins are going to be squeezed, but because I got to stand up to America, let's do it. I will even pay I will even pay my my my I would even use my savings to pay my my my my workers to keep the factory going simply because we need to stand up to America. I mean it is that's how the narrative is being used in in in China. I I I don't see that from a Chinese viewpoint the way they have played the Trump tariff narrative is it was actually to the to the benefit of the CCP

[54:25] in in many ways. So I don't I don't I'm not saying that there's no issues. There are definitely structural issues but they are they have very cleverly used that to to to to I think the the many things in there they're doing one is that moving up the value chain dumping all these stocks to I mean dumping all these things to to to countries like us because knowing that we we will at this point in time we will not we are not at the point where we can actually stand up to to China and WTO that will do it until that such time but I suppose this is where we need America too

[55:03] Uh I think the housing bubble is pretty much uh over uh meaning that the the slow release the pressure cooker and I think that that is pretty much done. What they how they have managed it is they have managed the prices to keep the prices low, electricity bills low, uh transportation low and uh uh wages um wages stable, keeping housing prices low or at least stabilize it, making sure that people have roofs over their heads. Uh making sure that the uh uh managing income disparity. So out of the housing market they have done these several things to keep to keep at least at the societal

[55:49] level stabilized for them that is primary. How do you see how do you see they're doing that in terms of managing income disparity? Oh, like you say doing developing now if you go to the third tier cities so-called third tier cities you know way out in the rural areas developing like you say bridges infrastructure railway metros subways isn't that going to increase your uh your over capac uh your your your overbuilding of uh construction network Yeah, but then you are actually spreading the wealth into the contractor at the local level. He is making money and yet and yet his uh material prices

[56:36] are stable or even falling for how long can you do that? Yeah, but they but it's a structural you are addressing a structural issue right of this. You ask me how they did it and this is how they've done it and that is why in the last

[56:50] limit to that they will so when the next problem comes it will have to be something else. So how do you actually so how how do you think they have actually raised you know uh uh uh erase uh poverty for 8 million people

[57:03] I I agree with you on that part on the on on the part yeah you're asking me how it was done so this is how they did it and this is how they have overcome it so now the next step is where is the next growth coming from the next growth is as the as as as the the the last plenary session was they have to go AI they will have to go that way

[57:24] well that that that that comes another problem where we are looking at about 20% I mean I can't wrap my head around this AI thing to be honest with you um I mean not just for China but from a global standpoint and even from our standpoint right um I I don't know where that industry is going how much is going to impact uh the employment sector overall uh because uh the last time I mean efficiency improves um really there's only so few people who can actually go into the software business uh you can't retrain your 40s people in their 40s you know um so that I think

[58:15] poses another challenge not just for China but for the world over overall um and I I'm I'm not very positive about that. So coming back to where China is looking at at AI, why are they pushing AI so strongly? On one hand, we say that there's a population decreasing that it's going to be a problem. And China is saying, look, I'm trying to push people up on the value chain. The more people on AI, the less people I have, more less mouths I have to feed.

[58:47] GDP will be divided by a smaller number. How how how is that bad for me? I mean I just don't understand you know what I mean so we are contradicting ourselves when we look at I know I'm just saying you know I mean we we as in you know analyst

[59:01] and and AI um why are people concerned about AI I mean there was that people are talking about oh sorry uh AI bubble is going to burst I say what is bursting what is bursting is actually stock prices right just like the com bubble does that mean today we are not using internet hey hello always you know I mean it is actually what what you're talking about two different things. You switch the application of AI or you talking about AI stocks, you know.

[59:27] No, at the end of the day, I believe in this. I think even the com bubble, what happens at the end of the day, the stock market burst because there was over speculation. Same thing with what they call what I mean the the the irrational exuberance of

[59:43] the green spans uh uh uh in those days what it wasn't called quantitative easing in those days. It was called uh oh I can't remember what it was anyway. You know what I mean? I know what you mean. We live we live we were we were old enough to live through that. Right. So I mean but at the end of the day um uh each of those revolution left remnants of technology that are applicable to the efficiency improvement uh that we see today. So I do I think the same will happen with the AI. The only difference I see also is um I guess I'm too old to really understand um uh

[1:00:25] just how disruptive the remaining tools that will end up you know and how much impact it will have on uh on on on especially white collar uh uh white collar employment

[1:00:40] the but going then I mean segueing actually out of China itself which we did touch a bit um is this issue with respect to uh how China then uh uh eases its internal issues to the rest of the world. um in our region as you rightly put uh we see their industry shifting shifting over here and I do believe it will be at the expense of the domestic and I think WTO is not the answer if you ask me

[1:01:20] um the reason WTO is not the answer is because uh uh I think every country looks after its own sovereignity and how it's going to handle it.

[1:01:35] Yeah. I don't think WTO I don't mean to say that WTO is the answer. I think it is definitely a pressure point to ch to at least channel our concerns to China. At this point in time, I feel China is still, let's put it this way, still cares about how it's being viewed by the rest of the world until it doesn't. I don't know what that is. I still I still feel that they

[1:02:13] I think that mood is shifting. If you ask Yeah, it is shifting very fast. That's why I say it's shifting very fast. Yeah, it's shifting. Okay. It's shifting very fast. It's shifting way. And coming back to AI, um so so again, you know, we're running away from talking talking about talking about AI, believe it or not, how how how China and Russia and maybe into to a point breaks how they view AI is it is it is going to take jobs away. It is going to take jobs away. And because it's going to take jobs away, it also will affect the distribution of wealth. Correct.

[1:02:54] Right? Then you will have maybe 0.001% of people who own AI companies will be making like trillions and trillions and trillions of dollars. And then you know the guy in the that sells roti to to deliver your roti to your house would be making like you know a dollar.

[1:03:11] You probably won't have people delivering roties anymore. No, you won't. You won't because you probably be sent by drones. Yeah. Because that drone is owned by this 0.001% of this this trillionaires and all that, right?

[1:03:24] So I think that inevitably uh will will will cause will cause a social collapse which is something that China will not want and I think this is where the irony is. I don't think any country wants

[1:03:39] even no country and which is why I feel in the the trajectory okay it will not be uh will not be capitalism but one of socialism huh yeah I think that would be the model of the 21st century you guys are you you and I going to disagree a lot on that one but you Leave it that as another topic for another day.

[1:04:10] Um because I don't see how else you can reduce real wealth. I I'm not and I don't think you can stop AI. It's like stopping I don't know. It's like stopping stopping our YouTube like our YouTube I mean how how is it possible that we can do this today?

[1:04:25] Yeah, I know right because it was the the broadcast news is dead. Yeah, it's dead. So you you can't stop AI. I I don't see how you can do it. The ship has sailed. So China knows that. big countries know that. Uh I I don't know how America is going to adapt to it.

[1:04:40] Yeah. Which is why which is a big question. Yeah. Yeah. Which is a big question. But but I I want to I I think let's let's let's pin that point for a while and for another conversation. I I I want to I want to uh

[1:04:54] I just want to say that I'm not a I I'm not a political scientist. Neither. No. But you know what I mean. No, I mean let's put it this way as everybody knows your your background is hugely an economics guy

[1:05:09] economics galop political economics you know but it is it is it is in many ways not not not a a separate thing but but I am not a what I'm trying to say is that I'm not an expert on uh on political theory okay let's put it that way

[1:05:25] I more I guess I I think I'm I'm coming from the point of view of somebody who uh I And I'm I'm a trained engineer and uh I've uh I've been building up business from the time uh I left uh I left multinational corporations right from in my 30s and uh I'm now in my 60s guys.

[1:05:50] Okay, we shall not go there. I think I'm I'm just on the brink. Yeah. So well well I mean the we're both trying to keep uh we're still energized. We're still energized to have this conversation. Yeah. So, so my point of view is what interests me and has always interest me is the analysis of what goes on because it gives me it gives people like ourselves, policy makers, day people who actually

[1:06:21] uh look at what is happening and make up their own mind you know uh based on what they hear that that is our role to a certain extent. So I I I want to I want to go to this side which is how it impacts us, how it impacts the rest of the world. Here's here's my starting point of the discussion. As I said,

[1:06:43] as I said, they've got no choice. It's got nothing to do with whether they're good or they're bad or whatever. I've got no morality pinned into this. Correct. If I'm in their situation, you probably do the same, right?

[1:06:55] I will do the same. Yeah. which is actually okay I see another market I'm going to come in right and uh I'm going to see whether I can get a market share in that particular country right

[1:07:09] and that is already happening in this region uh which means that and I think I'm going to say this again I I think I'm trying to find an analysis or a solution outside of the WTO because I think that organization is almost dead

[1:07:25] yeah what you're trying to say is that we need we need a push back strategy. Okay. So can I can I just so that I agree with you. Can I get get one more thing in? Right. Uh we are uh a a a richer nation relatively speaking than Africa, right? where um and and and upper uh Asia where the a lot of the investments done where the export of of of GDP in terms of building up infrastructure were taken on debt you know uh for railways

[1:08:10] uh ports and at the end of the day these poor countries cannot pay and actually what they see is their asset ass or supposedly what became of their assets uh being taken over by uh Chinese companies. Okay. It's almost like, you know, imagine the feeling that you take a bank loan to buy your house and 10 years down the road you can't pay and they foreclose you and you've got no more house and the only thing that comes out of that is going to be local resentment and all politics are local.

[1:08:48] Yeah. Right. Malaysia I think we are we are seeing we are slightly lucky because our GDP per capita is about what they are but the fact that they can come and swamp us because as you rightly put their population is so huge that the efficiency level we cannot compete you know so where do you see how do you see going

[1:09:13] I think first I think first of all I think first of all you need to look at the amount of what these third world countries if you want to call them third world countries developing countries or whatever owe to the IMF and owe to the world bank compared to China's belt and road I think the lendings are only makes up maybe about 20 to 30% of the entire loan so these African countries are poor in the first place is not because they owe China it's because they owe IMF and and and World Bank for the for decades right I I think you need to come from that premise to be there, right? Uh

[1:09:52] and how this is how this is uh uh uh and how China is actually dealing with it. I I believe is the pullback I think there are okay maybe because also they have you know issues at home but the pullback on on on the BRRI is somewhat because of that kind of backlash that they say okay you know so everyone's saying that we can't do this so they're a lot more careful now how they actually going to to to to deal with and a lot more selective than they did before um

[1:10:25] or is that also a combination of the the the cash flow is with yeah I think it's a I think it's I think it's also a combin it's a it's a combination of both okay it's a combination of both

[1:10:38] I think it's both it's both so it's not one or the other and to say that actually you know we you know uh Raja Paka you know Sri Lanka losing this and what do you call debt trap my god I tell if you want to talk about debt trap I'm IMF and world banks that trap I think is is is way more massive way way more massive you know at least three times more So I I I and and how the the African nations and all that kind of thing because uh you also got to see what kind of um technology transfer. I I I believe China is not at the point where they want to uh see themselves as um

[1:11:29] replacing I mean I I'm not I I'm I know you're not saying that you know replacing American in any way they are trying to resolve their domestic problems issue of over capacity uh which is which is hurting us. I mean we don't have a push back strategy. I think none of us have. I don't have one.

[1:11:54] You don't have one. I don't have one. I don't have one. I mean I'm not making excuses to say that okay what what you know this this that trap there is not real. Of course it's real. But to to to actually pin it down to on on on that alone I I think we also miss mis miss placing our our our narrative. Do we have a push back strategy?

[1:12:17] I don't think I don't I don't think we do. Even Singapore doesn't have it. You think all of us have? No. Singapore has Singapore. Singapore all they can say is that we got a lot of money. We got a lot of savings. Singapore very simple business model.

[1:12:32] Their two biggest sector is actually shipping and uh and and and finance and finance. Finance, right? And the money coming from this uh from from our region is I think what we are also missing ashams is that yeah we look at it oh yes you know uh push back and and and you know flooding our market and things like this but there's just so many things happening at the same time. What you're saying is that there is there is going to be new trade routes that is shifting away from the maritime not shifting away actually parallel to the maritime that's happening. such as

[1:13:10] a land. I mean I where China is coming from they they they have never been good at maritime and maritime is always been dominated by the west. So what do they do? They build pipelines. Power of Siberia 2 for example is a classic is example of okay so you're going to jam my jam straits of Malaca jam um um straits of hoods and all that they build a pipeline from China sing jang into the uh alai mountains in in in in in Russia once that's done in 2 three years time that's going to be 50 billion cubic metric tons or something like that in in of of of oil into into into China and

[1:13:57] that will actually be able to fuel their whatever AI agenda that they have for the next 50 years and cheaply too. I mean from an uh as an oil and gas guy um

[1:14:13] you are an oil and gas guy huh? Yeah, you are an oil and gas guy. It's uh uh p the pipeline thing has always been uh has has always been the the norm in that in the in the industry routes and routes on the northern sea routes right

[1:14:30] trade as a whole is a different ballgame alto together um you know I was I came back from uh Jakarta I mean I'm sorry I'm interrupting but then I want to keep I I want to keep the conversation going for example like uh uh uh I I came from Jakarta. I was talking to some money movers, okay, if you want if you want to call them for a better word. It's no long, in fact, if you want to talk about money, it's it's no longer New York. It's not even not even China, not even Hong Kong, not even Singapore. It's actually the Middle East.

[1:15:07] Yeah. Everybody is going to the Middle East to to to to borrow money, to do deals and things like the Russians are there, the Chinese are there, the That's why Trump is there. Okay. money. Yeah. I mean that is that itself if the geopolitics is sh I mean money talks right geopolitics are going to shift there. So I I I think we we we mustn't confine ourselves to to a static uh static uh uh analysis of what's going on although it does not doesn't doesn't solve our problem.

[1:15:36] May I say may I interject a bit on that? Actually I think the part I think we I hope that our audience understand one thing. Um sometimes I hope that we talk like this we will get people to start shifting and also understand and I agree with you totally on that point

[1:15:55] you know uh the monetary center of the world has shifted to the Middle East. Yeah. Right. And al and also okay let's let's look at gold. gold. Okay, I'm I'm I'm I'm not here to tell people to speculate, but look at the goal price goal setting now. It's no longer going to be LBMA. It's not it's probably not going to be COMX anymore. It's going to be shifting to China. And China is for building, I believe, four gold vaults. One in Hong Kong, one in Singapore. Okay. Singapore is not dodo. Okay. One in Saudi, three outside. Okay. And of course, Shanghai.

[1:16:33] Wow. Okay. I have my own. So that in itself setting of setting of prices of minerals of precious metals of re is no longer going to be in in the in the hands of the western markets.

[1:16:48] Well, I think um I think on on on gold I have my own opinion. I think there's a there's a limitation with respect to the mineral capacity.

[1:17:00] I I'm talking about minerals in general. Yeah. minerals in general in my opinion uh re we will get to a point where actually um it is not as um as uh as as rare as people think and the the thing is anybody who thinks that they have a lead in re uh uh either production

[1:17:23] refining or refining are deluding themselves. Okay. Uh the problem has always been is because the western country and even ourselves look at how long we we actually um stopped talking stop Lenas from operating right and now we like and now there's something happening with Lenas we are going you know I mean I

[1:17:49] that one I don't want to talk okay okay that one I tell you the liners problem I mean that in is just purely there's so So many things in this country was purely political and we were held back purely

[1:18:03] right because of politics okay and we believed in the whole narrative hook line and sinker in fact I had a conversation with Rafida Aziz I think back in this Tongano bi-election she says what's wrong I mean she knew the whole she knew the whole deal she says look this is something that's really good for our country why are we stopping this

[1:18:25] yeah no and and also for me as And as a that was 2010 as a business person and as with a background in science and engineering I was I think for as early as I could remember

[1:18:40] uh I was a big proponent of nuclear and I I was uh and I I saw this re uh and I'm like I was shaking my head and I'm I'm I'm going to say this to everybody. Okay. So now re is not a dirty word anymore.

[1:18:58] Yeah. And I'll put it this way too and I've been saying this for a long time. Fossil fuel are not fossils. And how how much how much time have we lost? Not just time, money, productivity, productivity and wealth for our people. And we are worried about climate change. I mean I'm just uh you know but I

[1:19:19] we we are digressing. Yeah. But we are digressing. So I I I I felt that I felt that um when we look at um uh when and I uh so I have something that I felt that we should be looking at in terms of policy strategy right and take a leave from what the Americans are doing right which is every country we've already done that the only problem with uh our country is actually we've done it for the wrong reasons. Um, we want to protect the domestic car industry and we make our people poorer for it.

[1:20:01] Mhm. Okay. And we actually created uh monopolies and oligarchies and uh and and and and crony businesses that actually u that that benefit out of it rather than opening deregulating and having our own borders allow competition within ourselves. Yeah,

[1:20:26] if you ask me, our FMB uh our FMB industry as a whole is actually very by vibrant um and we've got talent in there. Yeah.

[1:20:38] And we don't need to import that talent from uh China for example or anywhere else if you ask me. Okay. Uh we need to actually be able to protect our 30 plus million population. Um and you know my model actually the thing is that the problem with Australia for a long time I've admired how Australia actually were able to have domestic industries until they overregulated and actually they uh make their price of uh energy high

[1:21:14] because of all this renewables thing. Okay. So that is basic you ask me that's their biggest problem that they they they shot themselves in yeah you know but for a country that is so far away from all their markets they were doing very very well you know and they built uh they built a developed nation Malaysia the the thing is there are three things and one of the problem with all the uh developing countries or third world countries we are not pretty much third world anymore more. But the fact is the the the the biggest problem that we face is corruption because

[1:21:55] leakages from corruption takes away money from the economic system. I I think that is also going to be the if if you ask me it's not the economic policy or anything of China. It is actually the the one that is going to collapse China is is actually also going to be corruption. If you ask me

[1:22:17] everywhere I think that is history repeats itself. Don't you think so? Yeah. Yeah. Of course. That that is that is the the the is why you have runaway uh runaway inflation because you print money out of control to feed the oligarchs, feed your friends, feed your GLC's, feed your SOE. It

[1:22:38] it's it's the same thing the standard that is the standard standard template. You know what I mean? We all know it and yet we do it. Yeah. And I think that that is why I think um why South Korea was able to escape the so-called middle income trap, why Japan is able to escape the middle income trap and why Singapore, these three countries

[1:23:04] are exceptions to this rule if you ask me is exactly because they were able to overcome that uh that corruption problem. you know uh some better than others right but that is the single most biggest problem that not just people are space and so is China as you well put you know

[1:23:29] biggest their biggest problem yeah and that I think biggest enemy more than anything else more than housing collapse more than whatever it is corruption

[1:23:41] I think I don't know what you think about this but I mean my I've always uh felt that the you know people always say oh look at China you know they they they they just shoot their corrupt people. Um my my my rebuttal to that is yeah they just they shoot the corrupt people who are not on on their camp.

[1:24:04] Yeah that's right. You agree with me on that right? Of course I agree. Yeah. So depends on who holds the gun. Right. Exactly. You know, so who calls the gun? It depends on the decide you want to purge.

[1:24:18] Yeah. And then a corruption can also be legalized. No, then it doesn't become corruption, right? So I I think so we're we're on the we're on the same page on that. Yeah. So I think that's more also part of why I see all this. Right. M

[1:24:35] and the thing is because we do export to them and I see whatever happens to them is going to impact us they need to get their act together. we need to get our act together, you know, but for our people, um I think corruption is the biggest issue on the table for every voter and if we don't learn from what we see in the rest of the world and if you ask me when you brought up the issue of ah IMF they had more debt with IM Malaysia has zero debt from IMF

[1:25:12] and yet we are stuck at this per capita income. I brought up the same situation for me. If I have the double-digit growth that uh uh China has, okay, with the population that can consume, if it can consume, I should be looking at at least today uh GDP per capita in China, 30 to $40,000 uh per per capita. Easy. easy. Why are we not seeing that? You know, and the same goes with Malaysia. Malaysia without corruption, every one of you guys don't even talk about minimum minimum wage. Minimum wage does not work,

[1:25:58] right? You let you let the cap you let the the market system works, we we would we would be looking at at minimum $30,000 US per capita. We are looking at Singapore hitting $90 per capita. Yeah. Why are we not

[1:26:17] Why are we not? Well, we know that, right? Yeah. Yeah. So, that that that probably will come. I think I think we've we've we've gone quite a bit. Yeah, I think we did. We covered quite a bit for today.

[1:26:31] Yeah. I I want to thank Fu again for coming on board. I I'm always enjoying this conversation with you. um cuz it's always you know it's always back and forth

[1:26:43] and I hope uh our viewers uh enjoy this as well and learn out of it and and take something good from it and um and make up your own mind. Um help us grow, subscribe, like and share with your friends. Thank you so much for

[1:27:00] Can I Can I do a two second sales pitch? Please do it, my friend. Please, please, please. Uh we're coming up with a new book on um on geopol politics. You're talking about potential of uh

[1:27:13] Yeah. Yeah. Sense is coming out with a new book on um Malaysian Chinese in the multipolar world. So, we're looking at how the Malaysian Chinese community is shifting,

[1:27:25] has shifted, is shifting, and on a on a certain level, it's almost like a um it's not like some being is telling them what to do, but I see them as a as a group moving in a certain direction, which I think is very interesting. So, that will be that will be in my book, nine chapters. Oh, I tell you what, you know, I wish you had brought it up halfway through that just now because

[1:27:49] No, no, no. That that's a subject for another matter. Let's do that for another matter. When is the book coming out? Well, I'm still on 6, 7, 8, 9 is still not ready. But I mean, it's still I'm still editing. So,

[1:28:01] are you still editing? When do you expect to publish? It has it has to be 26 2026. I hope to get it out by before Chinese New Year, maybe. Oh, that would be nice. Yeah, that would be nice. But it's ambitious. But anyway, it will at least 2020 one.

[1:28:20] Yeah. Uh get me the book. I want to read it. Yes. And let's I think I suspect a lot of people will probably want to read it. It's quite uh it's looking at I think it's it's very relevant to what happened in in in in Sabah.

[1:28:37] Nice. how the Chinese have voted, how they have always voted, how they how the nature of the the the the way Chinese people take risks uh actually actually is a reflection on how they vote actually which which does which is always a what I find is a it's a it's a a gambler's hand but as gambling goes you don't always win right Well, here here's the thing. Here's the here's here's the thing. I'm a gambler.

[1:29:11] So, how Yeah. So, how do you move from a majority state to be a strategic minority? I think this is this is a question for the Malaysian Chinese community. It's interesting. I mean, we are a very small community, but actually not small. We are about 7 million now, believe it or not.

[1:29:28] Well, I think I I have a pitch on that that I want people to think. Um I've always said that actually um our government has uh done a propaganda on the on our population. We have never we have stopped publishing the data of uh uh race uh with respect to uh Malays uh Malay population

[1:29:56] um and uh and actually have redefined that to bumra if you were to ask me the Malay population um does not exceed maybe at best 50% and actually the non-Malay population has a huge huge influence over the direction of the country but they have been made to feel that they don't have a say in the country and this is something that I hope that you know I I truly believe that the viewers of this podcast

[1:30:31] is an extremely intelligent group of people you know it takes something to be able to go through uh the the conversations that I have over over uh once uh twice twice a week

[1:30:44] uh at this length and at this level of uh capac intellectual capacity. Yeah. Um and I I want to explore those further. Um so wait for the next one. You guys are going to be very interested in the next topic as well. Thank you so much for

[1:31:02] Thank you. Thanks. Thank you. Thanks for allowing my my sales speech.