KUALA LUMPUR (April 14): Malaysia will not resort to retaliatory tariffs and reaffirms its commitment to open trade in response to the US latest move to impose tariffs on certain imports, including goods from the country, according to the Minister of Investment, Trade and Industry (Miti).

Malaysia will instead focus on its approach involving reform, engagement, and trade diversification during these tariff headwinds, its minister Tengku Datuk Seri Zafrul Abdul Aziz said after the National Geoeconomics Coordination Council (NGCC) meeting with ministers on Monday.  

"The government reiterates Malaysia’s position that we will not impose retaliatory tariffs on imports from the US. Our approach is to reduce tariffs and expand our export list so that the negative impact on our economy can be mitigated," Zafrul told reporters here. 

The minister added that this stance was agreed upon during the NGCC meeting chaired by the prime minister. Several proposals from closed-door discussions are currently under review, with implementation to follow through coordination with the relevant secretariats.

"I want to stress that the economic situation remains under control and that our fundamentals are sound and stable. We are also adaptive to current developments and changes," Zafrul said. 

Malaysia is among more than 75 countries that received a temporary reprieve of 90 days from the US' reciprocal tariffs. The government has welcomed the move and plans to use the grace period to actively pursue negotiations with US authorities, according to Zafrul.

While a significant number of Malaysian exports to the US remain exempted from the 10% levy, the minister acknowledged that about 70% of affected goods — notably in semiconductors and intermediate components — are feeling the pressure.

“We’re currently studying the full impact, including ripple effects across supply chains and third-country competitiveness,” he said, adding that some exporters have absorbed the additional costs while others are passing them on to customers.

The semiconductor sector, a key pillar of Malaysia’s export economy, remains particularly vulnerable. "We are concerned, especially about any future tariff announcements related to national security," he said, noting that no major cancellation of orders has been reported yet. 

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