Vietnam, Indonesia edge in US tariff fight a concern, says Chow
GEORGE TOWN : Penang chief minister Chow Kon Yeow says the country is now at a 'real competitive disadvantage' after neighbours Vietnam and Indonesia were granted reduced tariff rates by US president Donald Trump.
Trump recently said exports from Vietnam and Indonesia will face a 20% and 19% tariff respectively, this after Vietnam was initially hit with a 46% tariff while Indonesia was handed a 32% tariff rate.
While Malaysia was first dealt with a 24% tariff rate in April, Trump increased the rate to 25% earlier this month. Negotiations to reduce the tariff are ongoing.
'The US raising tariffs on Malaysian goods to a staggering 25% is still very much a lingering issue. Meanwhile, the tariffs have been slashed for our neighbours.
'We must continue to explore creative and effective negotiation strategies, and bring these tariffs down by half,' he said.
Penang is the country's number one state in terms of exports, making up nearly a third of national exports in 2024. Its strength lies in electrical and electronics goods, especially semiconductors.
In a Bloomberg report last week, Malaysia Semiconductor Industry Association president Wong Siew Hai said semiconductor companies are hoping that the US will continue to exempt semiconductors from tariffs beyond Aug 1, the deadline for higher levies announced by Trump.
The US is Malaysia's third-largest market for semiconductor exports, and most major semiconductor firms in Penang are from the US, including Intel, AMD, and Micron.
Chow earlier opened Sirim's radio frequency and electromagnetic compatibility testing lab at the Penang Skills Development Centre in Bayan Baru here.
It will mainly benefit Penang's electrical, electronics and chip-making industries, which previously had to send their products to Shah Alam for such testing.
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