PENANG has expressed serious concern over the United States’ decision to impose a 25% tariff on Malaysian exports, warning that the move could significantly impact the state’s export-driven economy.
Chief Minister Chow Kon Yeow said the announcement of the tariff on a range of Malaysian goods has raised fears of disruptions to trade flows and investment patterns.
“Between January and May this year, Penang contributed 55% of Malaysia’s total exports to the US, amounting to RM52 billion.
“Much of this export volume came from American multinational corporations based in Penang, which ship finished goods or components back to their parent companies.
“The electrical machinery and equipment, primarily driven by the semiconductor industry, made up 77% of Penang’s exports to the US. While semiconductors are currently exempted from the new tariffs, we remain cautious, as the broader 25% imposition poses a threat to trade stability.
“The 25% tariff is expected to impact Penang’s highly export-oriented economy, which is deeply embedded in global value chains,” Chow said during a press conference when asked about the potential impact of the tariff.
Chow also noted that the move by the US could influence future investment decisions across the ASEAN region.
He urged the Federal Government to intensify engagement with the US to seek reductions in tariff rates and to address non-tariff barriers affecting Malaysia’s trade competitiveness.
“We are committed to working with industry players and federal authorities to defend national economic interests,” he said.
Chow added that Penang will continue to strengthen its infrastructure, simplify business processes, and reduce the cost of doing business to maintain its role in the global supply chain.
Story by Edmund Lee
Pix by Adleena Rahayu Ahmad Radzi
Video by Law Suun Ting