Latest news with #RM324.9bil
The Star
17-07-2025
- Business
- The Star
Trade deals must support economic reforms and growth, says minister
KUALA LUMPUR: Poor deals will have long-term repercussions on Malaysia, and that is why Putrajaya has several principles when it negotiates with the US, says Investment, Trade and Industry Minister (Miti) Tengku Datuk Seri Zafrul Abdul Aziz. Tengku Zafrul said Putrajaya's negotiating stance with the US is that any deals reached between the two countries must support Malaysia's economic reforms and sustainable growth policies. 'Our negotiating stance is always to ensure that whatever deal we land on will support the country's economic reforms and sustainable growth policies. 'Catchy, feel-good headlines last a few days, a week at the most. 'But poor deals will have long-term consequences on our people, industries and economy. 'I am certain negative long-term outcomes are not what the public wants nor what current and future taxpayers need,' said Tengku Zafrul in his opening remarks at the International Healthcare Week 2025 (IHW 2025) here yesterday. He also said Putrajaya will never sacrifice the country's sovereignty or sideline other trading partners in trying to close a deal with the US. 'Our people's rights, our country's sovereignty and trust with our valued partners are not bargaining chips,' added Tengku Zafrul. Malaysia is currently facing a 25% tariff rate for all exports entering the US and Putrajaya has until Aug 1 to negotiate with the US. According to Tengku Zafrul, trade negotiations are a complex multi-stakeholder process, where relevant ministries and agencies must be consulted to ensure a smooth implementation after negotiations. 'For context, the average duration for a regular trade negotiation is 18 months. For Miti, the fastest on record thus far is 11 months,' said Tengku Zafrul, referring to the recently signed comprehensive partnership agreement between Malaysia and the United Arab Emirates (UAE). 'So, we need to be realistic about trade deals that can be completed within 90 days,' he added. Tengku Zafrul also said that Putrajaya wants to ensure that any agreement with the US supports an open, rules-based and fair, multilateral trade, with the World Trade Organisation at its core. 'The agreement must also safeguard market access, while recognising the need of emerging countries like Malaysia to develop sustainable supply chains and economies,' said the minister. He also said that Malaysia values its economic ties with the US, noting that last year, Malaysia-US trade rose to nearly 30% to RM324.9bil, with Malaysia being an important source for products such as electrical and electronics (E&E), machinery, rubber gloves and palm oil. He said that Malaysia has been an important production base for US investments for at least five decades. 'From 1980-2024, there have been 169 American investment projects in Malaysia (RM77.5bil), in sectors such as E&E, machinery and scientific equipment,' he added. Tengku Zafrul said that for the past 50 years, these companies have received various investment incentives such as investment tax allowances, automation capital allowance and high-impact grants which are valued at RM4.1bil cumulatively. Annual incentives, he said, in the recent years have been between RM800,000 and RM1.2bil. 'So, we will continue to uphold the principles of positive reciprocity and fair competition while working alongside industry to innovate, diversify and maintain our resilience in the global market. 'These developments are also strong reminders of how and why we must always be ready, agile and adaptable to external shocks,' said Tengku Zafrul. Speaking to reporters at the sidelines of IHW 2025, he said that Malaysia is still negotiating a deal to lower tariffs with the United States ahead of the Aug 1 deadline. The minister said that while US President Donald Trump announced that Indonesia has struck a deal for a 19% tariff rate, he has not obtained further information from the Indonesian government. 'Let's wait for Indonesia's announcement. We are still in negotiations, we have until Aug 1. 'We still have time; most importantly, we must ensure that this is a negotiation that is beneficial to both countries. It must be win-win,' added Tengku Zafrul. Trump yesterday announced that Indonesian goods entering the US will face a 19% tariff, significantly lower than the 32% rate given to Jakarta earlier this month. Malaysia is facing a 25% tariff rate, up 1% from the initial 24% rate announced in April. Earlier this month, Trump announced varying tariff rates on 14 countries to take effect on Aug 1, including a 25% rate on Malaysia, Japan, South Korea, Tunisia and Kazakhstan. Other countries were hit with higher rates such as Cambodia (36%), Thailand (36%) and 40% in Laos and Myanmar, respectively.
The Star
16-07-2025
- Business
- The Star
Poor deals have long-term impact on Malaysia, says Tengku Zafrul
KUALA LUMPUR: Poor deals will have long-term repercussions on Malaysia, which is why Putrajaya follows specific principles when negotiating with the US, says Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz. Tengku Zafrul said Putrajaya's stance is that deals with the US must support Malaysia's economic reforms and sustainable growth policies. "Our negotiating stance is always to ensure that whatever deal we land on will support the country's economic reforms and sustainable growth policies,' he said. "Catchy, feel-good headlines last a few days, a week at the most. Poor deals will have long-term consequences on our people, industries and economy - I am certain negative long-term outcomes are not what the public wants, nor what current and future taxpayers need," said Tengku Zafrul in his opening remarks at the International Healthcare Week 2025 in KL on Wednesday (July 16). Tengku Zafrul said Putrajaya will never sacrifice the country's sovereignty or sideline other trading partners to close a deal with the US. ALSO READ: Malaysia still working on tariff negotiations with US, says Tengku Zafrul "Our people's rights, our country's sovereignty and trust with our valued partners are not bargaining chips," added Tengku Zafrul. Malaysia currently faces a 25% tariff rate for all exports to the US, and Putrajaya has until August 1 to negotiate. According to Tengku Zafrul, trade negotiations are a complex process involving multiple stakeholders and relevant ministries and agencies must be consulted for smooth implementation. "For context, the average duration for a regular trade negotiation is 18 months. For MITI, the fastest on record thus far is 11 months," said Tengku Zafrul. He was referring to the recently signed comprehensive partnership agreement between Malaysia and the United Arab Emirates (UAE). "So, we need to be realistic about trade deals that can be completed within 90 days," added Tengku Zafrul. Tengku Zafrul said Putrajaya wants to ensure any agreement with the US supports an open, rules-based and fair multilateral trade system, with the World Trade Organisation (WTO) at its core. "The agreement must also safeguard market access while recognising the needs of emerging countries like Malaysia to develop sustainable supply chains and economies," said Tengku Zafrul. He noted that last year, Malaysia-US trade rose nearly 30% to RM324.9bil, with Malaysia being an important source for products such as E&E, machinery, rubber gloves and palm oil. He said Malaysia has been a significant production base for US investments for at least five decades. "From 1980 to 2024, there have been 169 American investment projects in Malaysia (RM77.5bil), in sectors such as E&E, machinery and scientific equipment." Tengku Zafrul said for the past 50 years, these companies have received various incentives like investment tax allowances and high-impact grants valued at RM4.1bil cumulatively. Annual incentives in recent years have ranged from RM800,000 to RM1.2bil. "We will continue to uphold the principles of positive reciprocity and fair competition while working alongside industry to innovate, diversify and maintain our resilience in the global market. "These developments are strong reminders of why we must always be ready, agile and adaptable to external shocks," said Tengku Zafrul. Meanwhile, Tengku Zafrul said the global medical devices market is projected to grow 63% from RM2.53tril in 2024 to RM4.13tril by 2032. "The global healthcare sector has proven to be not only resilient but also transformative, offering immense opportunities in medical devices, pharmaceuticals, biotechnology and digital health solutions. "Thanks to our strong industrial reform agenda, robust industrial ecosystem, progressive policies, investor-friendly environment and a skilled, industry-ready workforce, Malaysia's healthcare industry is well-positioned to capture this growth," he said. Last year, the medical devices and pharmaceutical industries garnered RM2.13bil in investments, creating over 2,700 high-value jobs in manufacturing, R&D and regulatory services. "Today, eight of the world's top 30 medical device companies have operations in Malaysia," he said, adding that Malaysia is home to over 300 healthcare companies. Pharmaceutical exports from January to May this year increased by 7.8%. "This is due to our industrial reform initiatives. Reform builds industrial resilience, which in turn boosts our exports' resilience," added Tengku Zafrul. Commenting on the IHW, Tengku Zafrul said it's more than just a healthcare event, as it brings together global leaders, innovators, policymakers and investors to shape Southeast Asia's healthcare future. "I feel that the IHW 2025 represents more than an exhibition - it is a call to action for us to strengthen collaboration, accelerate innovation and ensure our healthcare systems remain inclusive, sustainable and future-ready," added Tengku Zafrul. The IHW 2025 takes place from July 16 to 18.
The Star
09-07-2025
- Business
- The Star
Govt urged to lower SST for now due to looming US tariffs
PETALING JAYA: The expanded Sales and Service Tax (SST) should be lowered temporarily amid mounting cost pressures and a looming 25% US tariffs, says the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM). Its presindent Datuk Ng Yih Pyng said tariff headwinds and global uncertainties were hitting at a time when businesses were already grappling with rising operating costs stemming from multiple government-imposed cost measures. 'This adds to the financial strain on businesses and could impact their ability to sustain operations and invest in future growth,' he said in a statement on Tuesday (July 9). He again urged the government to reconsider ACCCIM's proposal to reduce the expanded Sales and Service Tax (SST) rate from the current 6%–8% to 4% for the first two years of implementation. Ng also expressed concern over the cumulative impact of repeated cost increases, especially as businesses navigate an increasingly challenging global and domestic economic landscape, coupled with uncertainty surrounding US tariff policies. At the same time, the chamber welcomed the Investment, Trade and Industry Ministry's commitment to engage with the United States to secure a fair and balanced trade deal for Malaysian exporters. 'This commitment is vital, given the strong bilateral trade ties between both countries. The United States is Malaysia's second-largest trading partner and its largest export destination. In 2024, total trade surged by nearly 30% to RM324.9bil (US$71.4bil),' Ng said. He said the chamber believed the government would do its utmost to negotiate a reduction in the revised 25% tariff scheduled to take effect on Aug 1. 'ACCCIM fully supports the government's principle of maintaining open dialogue with the United States in working towards a well-considered, comprehensive and mutually beneficial trade framework.' Ng stressed that any negotiations must prioritise the national interest, particularly in protecting the interests of small and medium-sized enterprises (SMEs) and mitigating any adverse effects on local industries and employment. Malaysia is set to face a 25% tariff imposed by the United States starting Aug 1. This represents a one-percentage-point increase from the previous 24% rate, which had been temporarily suspended for 90 days. However, Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz has stated that there was still time to negotiate with the United States before the revised tariff comes into force.
The Star
08-07-2025
- Business
- The Star
M'sia to continue striving for mutually beneficial trade deal with US, says Miti
PETALING JAYA: Malaysia is committed to continuing its engagement with the United States to achieve a balanced, comprehensive and mutually beneficial trade agreement, says the Investment, Trade and Industry Ministry (Miti). In a statement on Tuesday (July 8), Miti said it would continue discussions with its US counterparts in good faith to address outstanding issues, clarify the scope and impact of the announced tariffs, and pursue avenues for the timely conclusion of our negotiations. "These efforts are ongoing and reflect Malaysia's willingness to reach a fair and sustainable outcome for both parties," the statement read. ALSO READ: Malaysia hit with 25% tariffs, up from 24% The United States announced that Malaysia will face a 25% trade tariff, with effect from Aug 1. The rate, as stated in a letter posted on US President Donald Trump's social media platform, Truth Social, is 1% higher than the previously imposed 24% and was paused for 90 days. While the ministry acknowledges the concerns raised by the US regarding trade imbalances and market access, it believes that constructive engagement and dialogue remain the best path forward. "The United States is Malaysia's second-largest trading partner and largest export destination, with total trade in 2024 rising nearly 30% to RM324.9bil (US$71.4bil). "Exports to the United States reached RM198.7bil (US$43.7bil), while imports rose to RM126.3bil (US$27.7bil)," the statement read. ALSO READ: Malaysia reaffirms independent trade policy amid Trump's tariff threat Malaysia, the ministry added, views unilateral measures as potentially disruptive to business operations, supply chains and investment flows that benefit both countries. "Malaysia strongly believes that together, we can find mutually acceptable solutions that safeguard the interests of both our countries and our peoples, while ensuring that bilateral trade and investment remain a positive force for sustainable economic development," it said. The government also remains committed to protecting the interests of Malaysian businesses, workers and consumers, and will take all necessary steps to mitigate the impact of these new measures, it added.
