US tariff reduction positive for Malaysia's export sector - Chow

GEORGE TOWN: Chief Minister Chow Kon Yeow said the move places Malaysia on par with other ASEAN countries, helping to create a level playing field in regional trade.

AI Brief

The US lowered its tariff on Malaysian goods to 19%, easing pressure on exporters and aligning rates with other ASEAN countries.
Penang officials say the move strengthens Malaysias trade position and supports local industries without concessions.
Malaysia continues to push for more tariff relief in strategic sectors to stay competitive in global supply chains.

"This is a welcome development that provides relief to the country's export sector, particularly in Penang, and it is a blessing. The tariff rate has been reduced and is now comparable to those of other ASEAN countries.

"This development has therefore placed most ASEAN countries on an equal footing in terms of ASEAN regional trade relations, and it marks a step towards enhancing Malaysia's trade competitiveness," he told reporters here today.

He said this after launching the National Month and the Penang-level Raising of the Jalur Gemilang ceremony, which was also attended by the Penang State Legislative Assembly Speaker, Datuk Seri Law Choo Kiang, who is also chairman of the Penang State Government Official Councils.

Chow was responding to media reports that the US will impose a reduced 19 per cent tariff on Malaysian imports, effective Aug 1, 2025.

On July 7, Washington had announced a 25 per cent tariff on all Malaysian products entering the US, in addition to existing sectoral tariffs, effective Aug 1 this year. This figure was one percentage point higher than the tariff rate announced in April.

Commenting further, Chow said that the revised tariff is just the beginning, as Malaysia still faces stiff competition from other regional countries that enjoy lower or zero tariff rates under various trade agreements.

"We are awaiting further details from the United States Trade Representative (USTR) and the Federal Government regarding which sectors may be affected or benefit," he said.

He noted that the state government has urged the Federal Government to continue negotiations to secure greater tariff concessions for strategic sectors, in order to maintain Malaysia's competitiveness in the global supply chain and its ability to attract high-value investments.

"The state government remains committed to supporting local industries and exporters as they adapt to the ever-evolving global trade landscape," Chow said.

On a related note, he described US President Donald Trump's reported intention to attend the upcoming ASEAN Summit as a positive sign that trade challenges between both sides can still be addressed through negotiation and mutual understanding.

"This tariff reduction has exceeded expectations and gives renewed hope for the future of Malaysia's international trade," he added.

-- BERNAMA