Malaysia must act now as 10pc US tariff not guaranteed ceiling, says industry expert

KUALA LUMPUR, Sept 3 — Malaysia should not consider the 10% tariff imposed by the United States on its goods as an absolute limit, according to Datuk Seri R. Jeyenderan, an industry expert. The US could adjust the rate if it finds Malaysia's efforts inadequate in addressing its concerns, Jeyenderan stated. While the 10% rate provides some relief compared to higher tariffs, exporters must remain vigilant as Washington may take additional actions depending on the outcome of its investigations.

The issue is particularly crucial given the ongoing US investigation into structural excess capacity involving Malaysia and several other economies. The current 10% tariff is part of broader US action under Section 301 of the Trade Act 1974, affecting 60 economies, with Malaysia among 17 subjected to the lower tariff. Malaysian businesses should use the wait time before the US announces its findings to strengthen evidence and prove commitments are being implemented effectively.

Strong transshipment controls are vital to defend against US concerns about goods passing through third countries. Malaysia's ability to trace goods through the supply chain is critical in showing that exports originate from genuine Malaysian production. A key urgent step is for the Investment, Trade and Industry Ministry and Customs Department to collect verified industry data, audit cargo movements at risk, and enforce forced-labour import restrictions.

Resolving these issues would give businesses certainty and strengthen Malaysia's defense internationally.