Malaysia braces for "tough" tariff talks with US, readies fallback offer

New Straits Times

12-06-2025

KUALA LUMPUR: The upcoming tariff negotiations between Malaysia and the United States will be "tough" but essential to reinforce both countries' complementary trade ties, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.
He said the ministry's Deputy Secretary-General (Trade), Mastura Ahmad Mustafa, who has been appointed chief negotiator, would lead on the technical groundwork ahead of the talks, allowing him to focus on strategic-level discussions.
"I'll be going to the US with our chief negotiator, Mastura. Negotiations have been ongoing virtually, but a physical meeting is necessary," he said at a press conference during the Regional Socialisation of the AEC Strategic Plan under the Asean Community Vision 2045.
"If Mastura manages to settle most of the technical matters, there will be less on my plate. But it's not going to be easy, and that's the reality. What's important is to demonstrate that the Malaysia-US trade and investment relationship is complementary. We are not undercutting or competing against the US," he added.
Tengku Zafrul will travel to Washington on June 18 to resume negotiations over tariffs imposed on Malaysian goods. He is scheduled to meet US Trade Representative Jamieson Greer, as well as other officials from the US administration and investors.
Meanwhile, Mastura told Business Times that Malaysia is prepared to present a fallback proposal in its ongoing tariff negotiations with the US should Washington deem its original offer "insufficient".
She said Malaysia's upcoming engagement in Washington would be a timely opportunity to re-engage US officials after earlier talks were postponed.
"I believe the US is currently more focused on its court cases and negotiations with China. They had earlier postponed our physical meeting," she said on the sidelines of the event held here, today.
"We will take the opportunity of the minister's visit to meet with them and get their feedback on our initial offer. If that's not sufficient for them to consider, we're ready with a second layer of proposals to keep the negotiations moving," she added.
Mastura did not disclose the details of either the initial or fallback offer.
Earlier, on April 24, Tengku Zafrul led a high-level delegation to Washington, where he held talks with US Commerce Secretary Howard Lutnick and Greer.
During that meeting, Tengku Zafrul stressed the importance of sustained engagement and reiterated Malaysia's commitment to finding constructive solutions to the concerns raised by the US.
Malaysia has expressed its readiness to negotiate in four key areas, namely narrowing the trade deficit, addressing non-tariff barriers, strengthening technology protection and security and exploring the potential for a bilateral trade agreement.
On April 2, US President Donald Trump announced tariff measures affecting around 60 countries, including a 24 per cent levy on most Malaysian goods.
However, the tariffs have been temporarily suspended for 90 days, with the exemption set to expire on July 8.