China–malaysia Economic Cooperation in the Context of Regional Supply Chain Restructuring: From Traditional Trade to the Digital Economy and Green Transformation in the Post-Covid Era

This article analyzes the recent development of China–Malaysia economic cooperation in the context of intensifying US–China geo-economic competition, global supply chain restructuring, and Malaysia’s increasingly prominent role within ASEAN. Drawing on an international political economy approach, the article argues that China–Malaysia economic relations have evolved beyond conventional bilateral trade into a multi-layered framework encompassing trade, foreign direct investment, infrastructure, the digital economy, artificial intelligence, customs logistics, and green transformation. China has remained Malaysia’s largest trading partner for sixteen consecutive years, while Malaysia recorded substantial growth in national trade in 2024, with China continuing to occupy the leading position. The article further contends that Malaysia has not passively accommodated China’s economic rise; rather, Kuala Lumpur has pursued a pragmatic hedging strategy by leveraging Chinese capital, technology, and markets while simultaneously maintaining strategic balance with the United States, Japan, the European Union, and ASEAN.