MALAYSIA HAS CLARIFIED TO CHINA ON ART - TENGKU ZAFRUL

KUALA LUMPUR, Dec 1 (Bernama) -- Malaysia has sent a delegation to China to provide information and clarification regarding the Agreement on Reciprocal Trade (ART) between Malaysia and the United States, said Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz today.

He said the delegation met with China’s Ministry of Commerce last week after the country expressed concerns about the geopolitical implications of the ART, given that Malaysia and China are strategic trading partners.

“They said they needed to put this on record because of the geopolitical issues. They wanted to make sure that whatever was agreed would not burden the trade relationship between the two countries,” he said when winding up the committee-level debate on the Supply (Budget) Bill 2026 for the Ministry of Investment, Trade and Industry (MITI) in the Dewan Rakyat today.

Tengku Zafrul said the discussions also led to China’s efforts to further strengthen trade cooperation through the signing of a new memorandum of understanding (MoU), although both countries already have existing frameworks such as the Regional Comprehensive Economic Partnership (RCEP) and the ASEAN-China free trade agreement.

Commenting further on Malaysia signing the ART earlier than several other ASEAN countries, he stressed that the decision was made because Malaysia's export structure is very exposed to US tariffs.

“This morning I also had a discussion with the USTR (US Trade Representative). He said we will get favourable treatment especially in the E&E and semiconductor sectors because we are strategic partners in these sectors," said Tengku Zafrul.

He added that Malaysia did not negotiate the ART in a comfortable atmosphere, negotiating under the shadow of a new 25 per cent tariff on almost all exports to the US and without the ART, Malaysia's GDP growth could decline by around 1.2 percentage points or almost RM30 billion per year.

“I would rather be criticised for moving quickly to save factories and people's jobs than be praised for daring to fight but letting the 25 per cent tariff be levied without any umbrella,” he said.

Tengku Zafrul also dismissed claims that the ART affected the position of bumiputera rights.

He added that Article 7.1 of the ART recognises Malaysia's rights and obligations in the World Trade Organization (WTO), including protecting national security and taking necessary trade measures.

The agreement can also be terminated with written notice after 180 days, as provided for in Article 7.5, said Tengku Zafrul.

-- BERNAMA