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MALAYSIA’S maritime sector faces mounting pressure from escalating global trade tensions, with experts warning that a prolonged tariff war could cripple smaller firms and disrupt operations at major ports such as Port Klang and the Port of Tanjung Pelepas.
Maritime analyst Nazery Khalid cautioned that smaller importers, lacking financial liquidity, are particularly vulnerable to rising shipping costs caused by retaliatory tariffs between the United States and China. In contrast, larger players with deeper pockets may be able to absorb the additional charges.
“Importers with deep pockets will pay the extra tariffs in addition to additional levies, but small companies without sizeable cash or liquidity will not pick up the goods and will leave them stranded at ports,” he told Bernama.
“This will result in cargoes being taken back to the ports of origin by the exporters or suppliers, failing which they will just leave the goods at the ports of destination. This will cause the ports to slap costly detention charges to the importers, resulting in cargoes being stuck and eventually piling up,” Nazery said.
The ripple effects could significantly strain Malaysia’s supply chain and port infrastructure. Already ranked among the world’s top 20 busiest container ports, Port Klang and the Port of Tanjung Pelepas could suffer a downturn if cargo volumes fall sharply.
The tension, stemming from renewed tariff hikes — with US import duties now reaching 24 per cent — is feared to trigger broader instability across maritime trade routes, further burdening an industry still recovering from the COVID-19 pandemic, volatile crude oil prices and global economic uncertainty.
“Another repercussion from \[US President Donald] Trump’s move is severe disruptions to the established order of the manufacturing supply chains which take a long time to build and nurture,” Nazery added, noting that smaller manufacturers risk losing reliable overseas suppliers due to unsustainable cost increases.
While some observers believe US manufacturers may consider reshoring, Nazery noted that cost efficiency and robust supply ecosystems will remain key drivers of corporate decisions. “They will likely seek countries with lower tariff regimes instead of quickly relocating to the US,” he said, suggesting Malaysia could attract foreign manufacturers with favourable incentives and infrastructure.
Port operator Westports Holdings Bhd echoed these concerns, noting that rising tariffs among major trading nations — a reversal of decades of globalisation — could trigger inflation, reduce consumer spending, and potentially tip global economies into recession.
“Lower containerised trade could emerge as a near-term impact,” it said. “However, regional trade realignment and Asia’s economic dynamism could partially mitigate the downward pressure on container volume.”
Despite these challenges, Sabah’s main port operator has reported positive short-term trends. Datuk Ng Kiat Ming, Managing Director of Suria Capital Holdings Bhd, said Sapangar Bay Container Port (SBCP) has yet to see adverse effects from the tariff war.
“In fact, March 2025 saw a 23 per cent increase in volume compared to the same month last year,” he said, citing strong intra-Asia trade flows and an uptick in regional shipping line calls at SBCP.
Nevertheless, industry players and analysts alike agree that the maritime sector remains in precarious waters, and close monitoring will be essential to weather the storm. - May 11, 2025