Malaysia Should Take Advantage Of Unilateral Agreements To Prepare For Possible Impact Of Trump S Tariffs


Trump, for his part, continued to attack The Atlantic and Goldberg and sent mixed messages on United States (US) President Donald Trump.— Reuters
KUALA LUMPUR: Malaysia should take advantage of all unilateral free trade agreements to further expand market potential as an early preparatory measure to face any possible impact from the implementation of tariffs by United States (US) President Donald Trump.
Director of the Master of Business Administration Programme at Putra Business School, Associate Professor Ahmed Razman Abdul Latiff said this effort could ensure that Malaysia is not overly dependent on one or two major trading countries such as the US and China.
Among the free trade agreements that Malaysia has signed are the Regional Comprehensive Economic Partnership (RCEP), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and also as a partner country of Brazil, Russia, India, China and South Africa (BRICS).
"Also as ASEAN chair, Malaysia should take the opportunity to increase trade activities within the region for the benefit of the country and its member countries," he told Bernama.
According to Ahmed Razman, the impact of the implementation of import tariffs by the US on Malaysia and regional countries will only become clearer on April 2 when Donald Trump announces the tariff rates that will be imposed on 15 countries that trade with the US, which is causing the US to experience a trade deficit.
Of the 15 countries, he said five were ASEAN countries, namely Malaysia, Thailand, Indonesia, Vietnam and Cambodia.
"In the 'dirty 15' list, Malaysia is likely to be among the countries with the lowest trade surplus with the US and therefore, if the US were to impose tariffs on Malaysian goods, the rate imposed is likely to be quite low or minimal," he said.
Apart from that, he said there was still room for the Malaysian government to negotiate with the US to obtain an exemption from the imposition of the tariffs.
The Ministry of Investment, Trade and Industry (MITI) had earlier said the introduction of tariffs by the US on Mexico, Canada and China could open up opportunities for Malaysian exporters to increase production and double their exports to the US.
In a reply at the recent Dewan Negara session, MITI said although it would not have a direct impact on Malaysian exports, the increase in the price of products from countries subject to tariffs would make Malaysian products a more competitive market alternative.
"Investor countries are also expected to look for new investment destination targets as well as competitive product sources to avoid paying high tariffs," he said.
Regarding Malaysia's chairmanship of ASEAN this year, Ahmed Razman said the smooth running of ASEAN-related meetings so far would have a positive impact on the country from an economic, investment or trade perspective.
This, he said, was evident when Bank Negara Malaysia had projected the country's economic growth at 4.5 to 5.5 per cent this year which would be driven by increased domestic economic activity alongside the influx of foreign investment, including from ASEAN countries themselves.
"Although it is still too early to assess the impact of these meetings on the economy and trade between member countries, at least we find that the smooth running of the meetings is clear evidence of the commitment of member countries to increase economic and trade activities in the ASEAN region.
"This is also evidence of the confidence of member countries in Malaysia as the ASEAN chair this year,” he said. - Bernama


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