Around that, there’s the usual trade deliverables. Malaysia commits to some market access for US goods, while the US applies a 19% “reciprocal” tariff to Malaysian goods with zero tariff exceptions for specified products, commitments on digital trade, rare earths, etc.

Lastly, Malaysia commits to align with all unilateral US export controls, cooperate on U.S. sanctions lists and explore a national security investment-screening regime. The US says it may take such cooperation into account when administering its own export control and investment review laws.

Malaysia also undertakes to adopt measures (again, with equivalent restrictive effect) that encourage shipbuilding and shipping by “market-economy” countries, echoing US efforts to de-risk strategic logistics from state-directed rivals (read China).

The agreement targets circumvention channels. Malaysia promises to police “unfair practices” by third country-owned firms operating on its soil that export below market price goods to the US or displace US exports.

The big novelty is the addition of mirroring clause if the US restricts a third country’s goods or services for economic or national security reasons, Malaysia must adopt a measure with equivalent restrictive effect.

3. Delgado-Vega, Álvaro, and @bartonelee2.bsky.social. 2024. ‘When Growth Leads to Zero-Sum Conflict’. t.co/MjBZ9BUCI3

The authors are agnostic about the origins of trade imbalances and rather ask what they do inside gravity models when tradables have external economies of scale, but also conclude that persistent trade imbalances are beggar-thy-neighbour.

…by suppressing household income and boosting saving/investment at home and pushing their excess production and capital abroad. Trade partners then absorb the demand shortfall via higher debt/un employment or by shrinking their tradables base.

The most recent discussion between @martinsandbu.ft.com and @michaelpettis.bsky.social also explains this distributional mechanism i.e. surpluses redistribute income and jobs toward surplus economies and away from deficit ones…

on.ft.com/4nSEjAk What we get wrong about China

Trade deficits on the other hand push resources toward local non-tradables, shrinking the traded base and dragging on productivity. Sectorally, that means export-oriented manufacturing and tradable services tend to expand in surplus economies and contract in deficit ones.

The main channel is that surpluses pull workers and capital into tradables (manufacturing and other exportable activities), which scales up those industries and lifts productivity and income.

🇫🇷's debt/GDP ratio is not "soaring." It is than in 2020, & it's borrowing costs are lower than in 2023.

I know that The Narrative™️ cannot fail & everyone has their own political preferences over arbitrary debt levels (bsky.app/profile/mcop...), but don't print lies in the newspapers, etc.

Overall, the EU-financed/EU-coordinated fiscal policy yields larger and more even GDP and convergence effects than nationally financed/managed variants precisely because it moves resources to where multipliers are highest and chooses projects whose payoffs don’t stop at the border.

Shared EU financing implicitly equalises across countries (richer members shoulder more of the bill), which boosts the overall macro impact and helps poorer regions catch up. EU-level coordination also internalises cross-border spillovers.

Authors simulate fiscal interventions under different “who-pays/ who-coordinates” setups over a 20-year horizon for a portfolio of cohesion policy-type investments (EU-wide financing vs. each country pays its own bill and EU-level allocation that internalises spillovers vs. national allocation).