KUALA LUMPUR, July 9 — Malaysia remains optimistic about the outcome of its tariff negotiations with the United States, banking on certain sectors that could be favourable to both countries, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.
He said sectors in which Malaysia is strong, such as semiconductors, could provide a win-win proposition for both countries.
“I am optimistic, especially in sectors where I feel there is a win-win (factor) and they complement each other.
“Malaysia is a key player in the semiconductor sector, which supports the supply chain for the US semiconductor ecosystem. So we need to continue the discussion,” he said during an online discussion at Reuters Next Asia here.
Tengku Zafrul said he has been engaging with US Trade Representative Jamieson Greer as recently as yesterday, and both parties agreed they could continue negotiating as there is still time until August 1.
“There are challenges, of course, there are issues that we still need to resolve. Many have been resolved but unfortunately not according to the timeline that was set.. with the announcement by (US President Donald) Trump, we have a few more weeks of extension to negotiate on the final terms,” he said.
He added that one of the issues raised was the trade balance.
“Malaysia has a positive surplus against the US. Our trade surplus last year was around US$25 billion.
“The US administration wants to see this lowered, and also in areas where they feel that there are red tapes on certain products, such as agriculture (and) halal, so these are issues which we need to address. We’re still discussing, of course, there are red lines as well,” he said.
Tengku Zafrul added that the parties had also talked about digital tax and issues pertaining to imports of certain products that may be harmful to Malaysia’s industries.
“These are things which we are still negotiating on, but most of the issues, external issues, have been resolved. I believe that the time given, namely, (till) August 1, will give us more avenues to resolve issues that have yet to be addressed,” he said.
On Monday, Washington announced it is imposing a 25 per cent tariff on any and all Malaysian products sent into the country, separate from all sectoral tariffs, effective August 1 — 1 per cent higher than what the US had announced in April.
However, Trump said there would be no tariff if Malaysia or Malaysian companies decide to build or manufacture products in the US.
Malaysia has been negotiating to lower the rate with Washington since April, with the most recent round of talks held on June 18.
— Bernama
