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| Malaysia is not considering retaliatory tariffs to the US following the recent 10 per cent tariff hikes and reciprocal tariff announced by US president Donald Trump on Malaysian exports to the US. STR/AMIRUDIN SAHIB. |
KUALA LUMPUR: Malaysia is not considering retaliatory tariffs to the US following the recent 10 per cent tariff hikes and reciprocal tariff announced by US president Donald Trump on Malaysian exports to the US, according to the Investment, Trade and Industry Ministry (MITI).
The ministry said it views these tariffs seriously and is "actively engaging" with the US authorities to seek solutions that will uphold the spirit of free and fair trade.
"The US tariffs affect many countries with potentially significant implications for global trade and growth.
"The National Geoeconomic Command Centre (NGCC), recently approved by the Cabinet, will evaluate the impact of this recent US announcement and will consider a comprehensive and multipronged strategy to mitigate the effects of these tariffs on our economy and industries," it said in a statement.
MITI said Malaysia will utilise the trade and investment framework agreement to seek reciprocal trade gains and pursue a technology safeguards agreement with the US to facilitate high-tech cooperation in semiconductors, aerospace, and digital economy sectors.
It cited the US Bureau of Economic Analysis which stated that Malaysia ranks 15th on the US list with a trade surplus of US$24.8 billion in 2024.
"Despite the trade deficit in goods, the US enjoys a trade surplus in services with Malaysia, reflecting strong bilateral economic ties that support jobs and economic growth for both nations.
"It must be highlighted that the trade deficit with the US is also due to many US firms that have been operating in Malaysia for decades, on account of Malaysia's well-established industrial ecosystem, especially in the electrical and electronic sector."
To mitigate tariff impact, the ministry said the government is expanding its export markets by prioritising high-growth regions and leveraging existing free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and the Regional Comprehensive Economic Partnership.
Malaysia will also foster new partnerships within Asean and enhance its supply chain resilience by accelerating the implementation of key industrial policies like the New Industrial Master Plan 2030 and the National Energy Transition Roadmap.
"We acknowledge that Trump's tariff hike poses a significant challenge to global trade dynamics. While respecting such sovereign decisions, Malaysia strongly believes in constructive engagement for mutually beneficial economic relations.
"MITI is committed to safeguarding Malaysia's economic interests and maintaining strong trade relations with the US," it said.
The ministry added that it is also in talks with the affected industries, while exploring support programmes to help businesses adapt.
It remains committed to open dialogue and collaboration to resolve trade disputes and promote mutual prosperity.
"Malaysia is facing this challenge from a position of strength and preparedness. The fundamentals of our economy remain robust.
"In the immediate future, while the external environment may be challenging, our diversified markets and products, along with strong demand for our produce, will provide us with some buffers," it said, adding that domestic demand remains robust and is the main driver of growth.
Source: nst.com.my
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