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KUALA LUMPUR: Malaysia is still assessing the full impact of Washington’s tariff measures and will pursue negotiations to reduce the rates besides expanding exemptions for Malaysian exports, says Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz. “We need to do a proper in-depth analysis on this. It will take time,” he said, adding that both direct and indirect effects must be considered, including how demand in the United States might change.
“What is important is that we must continue to engage with the United States and try to understand the concerns and try to mitigate some of those concerns,” he told a press conference on the US reciprocal tariff issue here yesterday. Tengku Zafrul said discussions had already begun at the working and senior official levels, and Malaysia is seeking a formal meeting with the US Trade Representative (USTR) and commerce secretary. “We haven’t gotten a date, but at the working level, and also at the senior official level, discussions have started.
” He added that a scheduled Asean meeting in Penang on April 24, which would be attended by the assistant USTR, could offer another platform for dialogue. In the meantime, Tengku Zafrul said Malaysia is also engaging with US companies affected by the tariff review. “So far, the large ones that we met have committed to continue with the investments that they have made.
Of course, there are some smaller ones that are concerned. It’s very hard for companies today to make any informed decisions,” he said. “But one cannot discount the fact that this (trade war) will definitely affect decisions of companies.
” In his earlier remarks, Tengku Zafrul said Malaysia would not impose retaliatory tariffs on US goods, but would pursue negotiations instead. “Our objective is to negotiate to reduce tariff rates and expand the list of exemptions for Malaysian exports, so that the negative impact on our economy can be reduced,” he said. He acknowledged the global supply chain implications of the US tariff action and said Malaysia’s response would balance national interests with international trade commitments.
“A shortage in one market may result in a domino effect, or a direct impact on the supply chain involving Malaysia’s economic relations with other countries.” While the situation remains fluid, Tengku Zafrul noted that the United States accounted for 11.3% of Malaysia’s total trade in 2024.
“This means that we still have about 88% of the market for us to increase our trade.” He added that Malaysia is also evaluating non-tariff barriers (NTBs) raised by the USTR, saying some criticisms were outdated or no longer applicable. He said the ministry had been tasked by the prime minister to coordinate discussions with all relevant ministries on NTBs, after which proposals would be brought to Cabinet.
“We will have to have a comprehensive strategy, but at the same time, we need to know where our red line is.” Tengku Zafrul said Malaysia’s official response is being shaped around three key pillars – engage, diversify and reform..
