BANGI - Malaysia has been urged to take the lead in resetting the Association of Southeast Asian Nations' (Asean) trade strategy in response to the sweeping new tariffs imposed by the United States.
With the US imposing a 24 per cent tariff on Malaysian goods, economists have warned that Malaysia must take a proactive role in driving trade reforms within Asean.
Universiti Kebangsaan Malaysia (UKM) Graduate School of Business Adjunct Professor and Malaysian Inclusive Development and Advancement Institute (Minda-UKM) Associate Fellow Dr Mohd Shahreen Madros described the US tariff announcement as more than just an economic maneuver.
He called for urgent action to tackle not only tariffs but also broader structural and policy challenges.
"It is not just about trade imbalance anymore. The world is becoming more divided and tariffs are now tools to assert geopolitical dominance.
"While Malaysia’s trade with the US, valued at around RM200 billion, makes up only a portion of its total RM2.9 trillion trade volume, the impact on the country’s export-driven economy could still be damaging," he said at the "Tarif Trump? Kesan dan Langkah Malaysia" forum held at UKM, yesterday.
Shahreen added that even if semiconductors and minerals were spared, disruptions to global demand and supply chains will still hurt Malaysia’s economy, especially export-reliant small and medium-sized enterprises (SMEs).
Meanwhile, Minda-UKM director Professor Tan Sri Dr Noor Azlan Ghazali stressed that Malaysia’s response must go beyond headline tariffs and address the underlying friction in trade relations.
He said while the tariff is set at 24 per cent, it is the non-tariff issues that are truly impactful.
"These issues reflect deeper structural friction in our trade and investment policies. We need to be honest about areas where we can improve and push forward with domestic reforms," he said.
Among the 12 issues raised by the US in its trade complaint were Malaysia’s automotive and halal certification policies, digital intellectual property enforcement and restrictions on foreign participation in banking and procurement.
Meanwhile, director of UKM International Trade and Investment at the Institute of Malaysia and International Studies (Ikmas) Professor Dr Sufian Jusoh pointed to Malaysia’s strategic role as Asean chair in 2025 as a unique opportunity to lead the region forward.
He stressed that Asean needed to revisit its 2045 vision.
"It is unrealistic to plan 20 years ahead in a volatile world. We should focus on the next 10 years with practical and flexible strategies," Sufian said at the forum.
The panellists also highlighted Malaysia’s weak local ownership of intellectual property and limited investment in research and development (R&D).
"Without economic complexity or ownership of technology, we remain vulnerable. We must create local champions and build value-added industries beyond just low-cost manufacturing.
"Over 88 per cent of patents registered in Malaysia and Singapore are held by foreigners, while Malaysia’s R&D spending remains below one per cent of GDP," Sufian added.
They called for Malaysia to initiate a high-level task force to address not only the impact of tariffs but also non-tariff barriers and the wider investment environment.