Kuala Lumpur: Prime Minister Datuk Seri Anwar Ibrahim has assured that Malaysia will not slip into a recession in the wake of new tariffs imposed by the United States, as the country’s economic fundamentals remain resilient. Anwar emphasized that Malaysia will not retaliate with its own tariffs.
According to BERNAMA News Agency, Anwar stated that if the 24 percent tariff were implemented, it could necessitate a review of Malaysia’s 2025 GDP growth projection of 4.5 – 5.5 percent. However, he reassured that the government does not currently foresee a recession in Malaysia. In a video addressing the US tariffs, Anwar, who is also the Finance Minister, highlighted the country’s strong macroeconomic foundations, supported by robust household spending, domestic investment, and tourism receipts.
He further stated that these sound economic fundamentals would help Malaysia manage the challenges posed by US President Donald Trump’s tariffs, which have impacted 168 countries and sparked a global trade war following China’s retaliation. Malaysia, being among the affected nations, will face a minimum of 10 percent duty on its products shipped to the US from April 5, with most products subject to a 24 percent rate from April 9, barring some exemptions.
Anwar underscored Malaysia’s concern as an open trading nation, viewing the unilateral tariff decision as a significant threat to the global trade and investment system. He asserted that the tariffs imposed by the US contradict the principles of free, non-discriminatory, and open trade under the World Trade Organisation (WTO), which the US helped establish.
The Prime Minister acknowledged the challenging mid-to-long-term impact, noting that as a major US trading partner and destination for US-based foreign investment, Malaysia would face difficulties. While some exemptions protect the semiconductor sector, Malaysia’s largest export category to the US, the new tariffs will adversely affect industries such as textiles, furniture, rubber, and plastics.
Anwar emphasized the government’s understanding of the concerns faced by workers and businesses in these sectors and reaffirmed their commitment to overcoming these challenges. He highlighted the flawed basis for the US’s 47 percent tariff calculation on Malaysia and pledged a calm and strategic response to secure a resolution that preserves market access and supports Malaysian interests.
In maintaining positive relations, Anwar stated the government’s intention to engage constructively with the US to safeguard market access and investor confidence. He outlined ongoing efforts, including detailed impact analysis, stakeholder consultations, and direct communications with US counterparts. Anwar also mentioned the establishment of the National Geo-economic Command Centre, which he chairs, as a proactive measure to address the tariff impact.