MALAYSIA EXPLORES MEASURES TO MITIGATE IMPACT ON EXPORTS, NOT CONSIDERING RETALIATORY TARIFFS - MITI

KUALA LUMPUR, April 3 (Bernama) -- The Ministry of Investment, Trade and Industry (MITI) views the 10 per cent tariffs hikes and reciprocal tariff announced by the United States of America (US) on Malaysian exports to the US seriously and is actively engaging with the US authorities to seek solutions that will uphold the spirit of free and fair trade.

In a statement, MITI said the US tariffs affect many countries with potentially significant implications for global trade and growth.

The National Geoeconomic Command Centre (NGCC), recently approved by Cabinet, will evaluate the impact of this recent US announcement and will consider a comprehensive and multi-pronged strategy to mitigate the effects of these tariffs on our economy and industries.

The NGCC, to be chaired by the Prime Minister with MITI as the Secretariat, features high-level representatives from key ministries and agencies.

The NGCC’s key focus is to ensure that the Malaysian economy remains competitive amidst these volatile times.

ASEAN Geoeconomic Task Force to commence soon

At the ASEAN level, the first meeting of the ASEAN Geoeconomic Task Force -- established at the ASEAN Economic Ministers’ Retreat in February 2025 -- will also commence soon.

MITI said Malaysia will utilise the Trade and Investment Framework Agreement (TIFA) to seek reciprocal trade gains and pursue a Technology Safeguards Agreement with the US to facilitate high-tech (technology) cooperation in semiconductors, aerospace, and digital economy sectors.

According to the US Bureau of Economic Analysis, Malaysia ranks 15th on the US list with a trade surplus of US$24.8 billion in 2024 (US$1=RM4.45).

“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 electronics (E&E) sector,” said MITI.

The ministry said that President 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,” it said.

MITI committed to safeguarding Malaysia’s economic interests, to expand export market

MITI said it is committed to safeguarding Malaysia's economic interests and maintaining strong trade relations with the US.

“To mitigate tariff impact, Malaysia is expanding our export markets by prioritising high-growth regions and leveraging existing free trade agreements (FTAs), including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).

“Malaysia will also foster new partnerships within ASEAN and enhance Malaysia’s supply chain resilience by accelerating the implementation of key industrial policies like the New Industrial Master Plan 2030 (NIMP 2030) and the National Energy Transition Roadmap (NETR),” it said.

MITI said the government is engaging with the affected industries while exploring support programmes to help businesses adapt.

“MITI 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,” said the ministry.

Furthermore, domestic demand, the country’s main growth driver, remains robust, and MITI believes the Malaysian economy will continue to be resilient amidst these challenges, it said.

-- BERNAMA