[KUALA LUMPUR] Malaysia will seek diplomatic solutions, prioritising dialogue with the US authorities on its tariff policies, and will not consider retaliatory tariffs for now, the Ministry of Investment, Trade and Industry (MITI) said on Thursday (Apr 3).
The country will be hit with a 24 per cent tariff on exports to the US starting Apr 9, under Washington’s latest trade measures against countries with large trade surpluses.
While taking the tariffs “seriously”, Malaysia will not impose retaliatory measures, the ministry said in a statement, adding that it is in talks with US officials to find “solutions that uphold the spirit of free and fair trade”.
Instead, Malaysia plans to leverage existing platforms such as the US-Malaysia Trade and Investment Framework Agreement, and push for a Technology Safeguards Agreement to deepen cooperation in semiconductors, aerospace and the digital economy.
The country will be subjected to a 24 per cent reciprocal tariff under a broader US trade policy targeting countries with significant trade surpluses with the US.
According to the US Bureau of Economic Analysis, Malaysia recorded a trade surplus of US$24.8 billion with the US in 2024, ranking 15th among the countries with the largest US trade deficits.
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Despite the deficit in goods, the US maintains a trade surplus in services with Malaysia, underscoring strong bilateral economic ties that support jobs and growth in both economies, MITI said.
“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, benefiting from the country’s well-established industrial ecosystem, particularly in the electrical and electronics sector,” it added.
Beyond negotiations with the US, Malaysia’s National Geoeconomic Command Centre will assess the tariff impact and formulate a comprehensive, multi-pronged strategy to mitigate risks.
At the regional level, Malaysia will soon convene the first meeting of the Asean Geoeconomic Task Force – established at the Asean Economic Ministers’ Retreat in February – to address the issue.
Despite the tariff hikes, MITI said Malaysia’s economic fundamentals remain strong, providing the country with a solid foundation to navigate these challenges.
