THE much-talked-about tariff issue came in a rather relieved wave to Malaysia after receiving a percentage cut from 25% to 19%.
Chief Minister Chow Kon Yeow, while welcoming the news on behalf of the state government, labelled the tariff cut as a boost for trade competitiveness.
“This development offers some relief to our exporters, particularly in Penang’s key sectors, such as electrical and electronics (E&E), manufacturing, and medical devices.
“However, the reduction is only partial, and we continue to face strong competition from regional economies that enjoy even lower or zero tariffs under other trade agreements.
“Nevertheless, we are currently awaiting an official response or clarification from the Federal Government regarding the implications of this reduction and the way forward,” Chow said when met with reporters at the Kompleks Masyarakat Penyayang in George Town today.
Chow was there to launch the state-level National Month celebration and the ‘Fly the Jalur Gemilang’ campaign.
Later, he further mentioned that it is a blessing that the tariff rate has been reduced in line with other Asean countries.
“This has put our country on a level playing field in the sense of trade relationship between Asean countries and the United States (US),” he said.
Chow added that the Penang government also strongly urges the Federal Government to continue negotiations for further tariff concessions, especially in sectors where Penang has strategic economic strengths.
“This will be crucial for us to remain competitive in the global supply chain and to attract future high-value investments to Penang and Malaysia as a whole.
“The state government remains committed to supporting local industries and exporters as we navigate these evolving trade conditions,” he added.
Earlier, it was reported that Malaysia will now face a 19% tariff on exports to the US, reduced from the previous 25%, under an executive order signed by US President Donald Trump.
The updated tariff structure will come into effect in seven days and will apply to goods imported into the United States for consumption, with only a few exceptions made for shipments already en route.
Issued on July 31, 2025, the order modifies Executive Order 14257 and introduces new ad valorem duties on several trade partners, including all key Asean countries.
According to the latest tariff schedule, Malaysia, Thailand, Indonesia, the Philippines, and Cambodia, will each be subject to a 19% duty.
Vietnam will face a 20% tariff, while Brunei is assigned a 25% rate. The highest tariff, at 40%, will apply to Laos and Myanmar. Singapore is not affected by the new tariff changes.
Story by Riadz Akmal
Pix by Siti Nuratikah Rahmat
Video by Alissala Thian