The Minister of Investment, Trade, and Industry (MITI), Tengku Zafrul Abdul Aziz, spoke to the US government about reducing the 24% tariffs and revealed that the White House has four demands to reduce tariffs against Malaysia.
In a press conference yesterday evening (May 5), Tengku Zafrul shared with the media what Washington had in mind before the reduction in tariffs could happen.
1. US’ trade deficit with Malaysia
A trade deficit occurs when a country’s imports exceed its exports. A trade deficit is also referred to as a negative balance of trade. Tengku Zafrul shared that the deficit the US has with Malaysia is not “something they look favourably at,” and said that the deficit amounts to USD25 billion (approximately RM105 billion).
2. Non-tariff barriers (NTB)
NTBs are trade restrictions that limit international commerce without imposing direct tariffs and are used to protect local industries against foreign competitors. In other words, NTBs are restrictions that limit trade without taxes.
According to Tengku Zafrul, the US government believes that many areas can be improved, such as the process of obtaining a Halal certificate.
“We spoke about the Halal certification at parliament today. It’s not about the certification itself but the process and time taken to obtain it.”
3. Safeguarding US technology
Tengku Zafrul said Trump mentioned multiple times about securing US technology, and the President expects countries like Malaysia, Singapore, and Indonesia not to ship or smuggle the chips to other countries that the US doesn’t approve.
4. Investing in the US in approved areas
As for the final demand, Tengku Zafrul said the US wanted Malaysia to invest in areas they wanted and support their industries. He added that Malaysia had indeed made major investments.
“Today, the prime minister mentioned that even government-linked companies and government-linked investment companies have invested almost USD45 billion (approximately RM189 billion) into the bond and equity markets in the US.”
Tengku Zafrul also clarified and said the objective of Malaysia’s negotiations with the US was not simply to reduce tariffs, but to bring the tariffs down to zero.
What do you think of the demands?
Also read: “Cancel tariffs if you want to talk” – China Says There are No Ongoing Negotiations With the US
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This post first appeared on WORLD OF BUZZ.
