All eyes on US tariff response

The Star

04-05-2025

PETALING JAYA: Business groups and industry players will be closely monitoring the Parliament's special sitting today, which is set to discuss the impact of US tariffs.
The special session will see about 20 lawmakers debating the implications of the United States' decision on the country's economy as well as the Malaysian government's long-term planning and responses to the tariffs across key sectors.
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SME Association of Malaysia national president Dr Chin Chee Seong said local businesses are awaiting the outcome of the discussion in the Dewan Rakyat, especially the Prime Minister's key message.
'We appreciate the efforts made by the government as it is a pertinent issue that will have a huge implication on the national economy,' said Chin, who is also the deputy chair of the Malaysia-China Business council.
Small and Medium Enterprises Association of Malaysia (Samenta) president Datuk William Ng said they will be closely monitoring the proceedings, particularly if there is any announcement which could impact businesses.
He said this would also include suggestions on how Malaysia should tackle the issue.
'We must not be mere spectators in this tariff war but neither should we be part of any escalation.
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'While it is important to help SMEs negate the challenges of the tariff, especially in diversifying our source of customers and suppliers, it is also important to identify opportunities that are presented by the tariff,' he said.
Among the suggestions Ng is hoping to see is a halt on any planned increment in fees by agencies or councils on businesses until there is better clarity on the impact from the costs.
'We also hope there will be strategies put forth on seeing closer cooperation among Asean countries.
'This includes working more closely with our Asean neighbours in reducing Non-Tariff Barriers (NTBs) and promoting intra-region trade, working with China for better two-way trade and exploring opportunities in the Middle East and Central Asia.
On April 3, US President Donald Trump announced that the United States would impose a basic 10% tariff on all imports as well as reciprocal tariffs of up to 24% on goods from Malaysia.
However, the Trump administration subsequently announced a 90-day pause until July 8 on the reciprocal tariffs.
China and the United States – both of which are important trade partners to Malaysia – are currently in a tariff war, with each having implemented tariffs of over 100% against each other.
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Convened at the request of the Prime Minister under Standing Order 11(3) of the Dewan Rakyat's house rules, the sitting today will serve as a key platform for ministers to brief Parliament on the government's response and outcomes of recent bilateral engagements.
It will also address the broader economic impact of the US tariffs and outline coordinated responses across ministries and sectors.
The sitting will also provide an opportunity for MPs to hear from Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz – who had led a high-level delegation to Washington on April 24, where he held talks with US Secretary of Commerce Howard Lutnick and US Trade Representative Jamieson Greer.
Malaysia had expressed openness to negotiations on four key areas: reducing the trade deficit; addressing non-tariff barriers; strengthening technological safeguards and security; and exploring a potential bilateral trade agreement.
MPs, said political analyst Professor Dr Azmi Hassan, should take this opportunity to ask the government tough and hard questions to get clarity on all related issues.
'The Prime Minister should also not sugar coat his answers and give the real picture of the issues we are facing as a nation,' he said.
Political analyst Prof Datuk Dr Sivamurugan Pandian said the sitting was not just important for MPs to listen to Datuk Seri Anwar Ibrahim's views as the Prime Minister and Malaysia as Asean Chair, but also on whether it had found a workable formula for the country, the United States and Asean.
The sitting, he added, was pertinent to show solidarity for the government's decision and to ensure that it will not affect the well-being and livelihood of the public, and multilateral relations.
'The Opposition can also use this sitting to show that national interest is above political differences,' he said.
Bayan Baru MP Sim Tze Tzin said the business sector is not the only one showing keen interest in the debates, as international players such as China and the United States would also be listening in to see how the government is responding to key issues.
'I managed to get direct feedback from the stakeholders in my constituency, mostly from the electrical and electronics sector, on the challenges and anxiety that they are facing.
'Although the sector is still exempt (from US tariffs) for now, the impact will be big if it is implemented,' Sim said, adding that about 20 MPs are taking part in the debate.
As a backbencher, Sim said he will be debating and supporting the government's strategy, which is to find a balanced approach with no retaliatory tariffs, as well as finding ways to negotiate with the United States.
'I think as a middle income country, that is the right approach for Malaysia,' he said, urging the Opposition to put the interest of the country first and support the government.
'We must speak as one as there is too much at stake.'