Tengku Zafrul: Malaysia agrees to 6,911 zero-tariff lines with US, maintains duties on alcohol, tobacco and vehicles

Malay Mail

3 days ago

KUALA LUMPUR, Aug 1 — Minister of Investment, Trade, and Industry (Miti) Datuk Seri Tengku Zafrul Abdul Aziz said Malaysia will have 6,911 lines with zero tariffs following protracted negotiations with their American counterparts.
He said this amounted to 61 per cent of the total 11,260 tariff lines requested by the United States. A tariff line refers to an item listed in a country's tariff schedule, which is used to classify merchandise goods for the purpose of applying tariffs.
The agreement follows extensive negotiations involving multiple ministries, agencies and stakeholders while ensuring Malaysia's national policies and strategic interests are not compromised.
'This is a systematic and methodical approach to determine our final offer to the United States and we've made a comprehensive offer that covers 98 per cent of all tariff lines but have only agreed to liberalise 61 per cent,' Zafrul said at a press conference at Miti headquarters today.
He also clarified that the semiconductor and pharmaceutical industries are not affected and imports to US remain at zero tariff.
He reiterated that, as of today, the tariff rate has dropped from 25 per cent to 19 per cent and is in effect.
Zafrul also addressed the issue of non-tariff barriers stating that the government is committed to reforming bureaucratic processes that have historically been seen as impediments to trade and investments.
'We acknowledge that some non-tariff barriers arise from inefficiencies in the system and we see this as an opportunity to improve our processes. However, these reforms will not come at the expense of Malaysia's regulatory standards,' he said.
Despite the concessions, Zafrul also said Malaysia drew the line on key sectors.
He said the government refused US requests to abolish excise duties on vehicles, tobacco and alcohol and declined to eliminate import permit requirements or relax foreign equity caps in strategic sectors.
'We are not compromising our economic sovereignty or national security. Excise duties, import licenses and equity restriction remain in place where necessary,' he said.
Zafrul said that negotiations are always ongoing and are part of a broader strategy to strengthen Malaysia's trade position while safeguarding domestic industries.