Malaysia Affirms Continued Tariff Negotiations With US

(MENAFN- Kuwait News Agency (KUNA)) KUALA LUMPUR, July 8 (KUNA) -- Malaysian Investment, Trade and Industry Minister Tengku Zafrul Abdulaziz affirmed Tuesday that there is time to negotiate with the US regarding the 25 percent tariff announced by US President Donald Trump, which is scheduled to take effect on August 1.
Abdulaziz explained that the tariff rate announced by Trump was unexpected, that they didn't know what to expect other than a 24 percent tariff to start July 9, which has now become a 25 percent tariff to start August 1.
He added that this gives them time to continue engaging with the US side, and that engagement has not stopped.
In a separate statement, the Malaysian Ministry affirmed the government's commitment to continuing cooperation with the US to reach a "balanced" and "mutually beneficial" trade agreement.
It also acknowledged the concerns raised by Trump regarding trade imbalances and market access, but warned that unilateral measures such as tariffs hinder business operations and supply chains and discourage investment in both Malaysia and the US.
The statement noted that economic relations between Kuala Lumpur and Washington are strong, with bilateral trade increasing by about 30 percent in 2024 to MYR 324.9 billion (USD 71.4 billion), emphasizing that the US remains Malaysia's second-largest trading partner and its primary export destination.
Observers expect the US tariffs to negatively impact the competitiveness of Malaysian exports in the US market, leading to higher prices for products such as electronics, furniture, and rubber gloves compared to those from other competing countries.
Some foreign investors using Malaysia as an export base to the US market may be forced to scale back or relocate their activities to other countries to avoid the tariffs, which will impact job opportunities and economic growth in the country.
Economists have warned that the decline in exports could lead to a decline in demand for the Malaysian currency (the ringgit), weakening its value in global markets.
Trump sent an official letter to Malaysian Prime Minister Anwar Ibrahim in which he described the 25 percent tariff on Malaysian goods as "far less" than what is needed to address the US trade deficit with Malaysia.
Trump also warned that any attempt to reroute goods through other countries to avoid the tariffs would be met with higher tariffs, stressing that any decision by Malaysia to raise tariffs on US goods would trigger an immediate US response with additional tariffs. (end)
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