By Danial Dzulkifly
KUALA LUMPUR, May 5 — Prime Minister Datuk Seri Anwar Ibrahim rejects the United States’ claim that Malaysia has imposed excessive tariffs amounting to 47 per cent on American goods, describing the accusation as “baseless and unfair”.
Speaking during a special parliamentary sitting today, Anwar criticised the US administration's move to introduce sweeping retaliatory tariffs of up to 24 per cent on Malaysian goods, calling it a regressive step that undermines the international rules-based trading system.
“The United States' calculation is based on a simplistic ratio of its trade deficit with Malaysia compared to its total imports from Malaysia in 2024.
“This claim is being used as the basis to impose a 24 per cent retaliatory tariff on Malaysia, a 50 per cent reduction from the alleged 47 per cent tariff said to be imposed by Malaysia on US imports.
“However, this calculation does not reflect the actual tariff levels and lacks a sound foundation in economic theory,” he said in the Dewan Rakyat.
Anwar warned that such protectionist policies could lead to a fragmented global trade system and exacerbate economic hardship, especially for nations in the Global South.
Under the new US trade policy direction introduced by President Donald Trump’s second administration, Malaysia is now subject to a retaliatory tariff of 24 per cent.
However, this rate has been temporarily reduced to 10 per cent during a 90-day review period, effective from April 9.
In response, Anwar said Malaysia will continue to strengthen trade ties with traditional partners and expand into new international markets, particularly across Asean, China, Japan, and the Gulf Cooperation Council (GCC) nations.
He also said that initial trade negotiations with the US were progressing well, with the Malaysian trade delegation led by Investment, Trade and Industry Minister Datuk Seri Tengku Zafrul Abdul Aziz recording positive developments.
However, he said discussions would continue to ensure a fair and win-win outcome for all parties involved.
Despite the external pressures, Anwar said Malaysia’s economic fundamentals remain strong, citing GDP growth of 5.1 per cent in 2024, a declining fiscal deficit, manageable inflation, low unemployment, and a record RM378.5 billion in approved investments last year.
However, he acknowledged that the tariff imposition could dampen national GDP growth, potentially reducing it from 4.7 per cent to 4.1 per cent, according to estimates by the International Monetary Fund (IMF).
Malaysia will not bow
Anwar stressed that Malaysia would not easily yield to global pressures and reaffirmed the nation’s commitment to preserving its core economic policies.
“I would like to emphasise that the nation’s key policies, including the Bumiputera policy, requirements for local vendors, and the protection of strategic sectors, will not be altered in any of these negotiations.
“This is because while we are committed to pursuing our free trade agenda, we cannot ignore the importance of national security and strategic interests.
“I must stress that true economic strength is what ensures our success, not trade negotiations, not the ability to attract foreign investment, and not merely opening up new market access.
“That is why I believe, and I am confident that the strength of our government machinery, the private sector, and our excellent workforce will steer the nation through this temporary crisis.”
Anwar also announced targeted financial support totalling RM1.5 billion, which includes an RM1 billion in government guarantees under the Business Financing Guarantee Scheme (SJPP) to help small and medium exporters access commercial bank loans.
A further RM500 million will be allocated through the Soft Financing Fund via Development Financial Institutions (DFIs), providing direct financial relief to affected entrepreneurs.
Anwar also said that the government would continue monitoring the situation and stands ready to roll out further targeted assistance if required.
