US court ruling to determine Malaysia’s next move - Tengku Zafrul

KUALA LUMPUR: The outcome of the United States (US) Supreme Court ruling on the legality of US President Donald Trump's tariffs will determine Malaysia's next course of action, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

AI Brief

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The government will seek legal advice on how to manoeuvre if the results impact Malaysia adversely, he said.

"When you sign an agreement, you need to have the right intention. So if your strategy is to sign but want to ratify thereafter, or wait for something else that's beyond our control, that's not being honest.

"As the Malaysian government, if we have committed, we must show that commitment, or our credibility is at stake. So let's say the federal court clears the decision, and it goes to Congress. He is the president and has executive powers. We will wait until Congress happens," he told a press conference on the ministry's report card for the third quarter of 2025.

The media had asked Tengku Zafrul about the implications of the US court ruling and whether there would be delays ratifying the Malaysia-US agreement.

Tengku Zafrul also said Malaysia sees major growth potential in the semiconductor sector and is committed to advancing favourable outcomes in the ongoing Section 232 negotiations with the US regarding critical sectors.

According to MITI, the US will give special consideration to Malaysia's semiconductor sector in tariff negotiations under Section 232 of the US Trade Expansion Act of 1962.

"For now, the 1,711 Malaysian exports to the US will enjoy zero tariff under the Agreement on Reciprocal Trade (ART) signed between Malaysia and the US. (Semiconductors are not included in the 1,711) but tariffs are still at zero for now (for semiconductors).

"To be frank, under Section 32, there's still (the possibility of) negotiation. There's still a review and study on how it impacts the economic security of the US. But for us, we will continue to engage (with the US). The signing of ART opens the door for better opportunities to negotiate on semiconductors," he said.

Tengku Zafrul added that Malaysia will prioritise opening new markets, as reflected in Budget 2026, in which the government increased the Market Development Grant by 100 per cent to support Malaysian companies going abroad through the Malaysia External Trade Development Corporation.

He added that Malaysia aims to deepen its presence in existing markets, particularly in Latin America and Africa, where Malaysian firms already have a foothold.

-- BERNAMA