Kuala Lumpur: RHB Bank Bhd has maintained a cautious outlook on Malaysia’s export performance despite a surge in April exports, citing persistent global uncertainties and potential risks from United States tariff policy developments.
According to BERNAMA News Agency, in its latest Global Economics and Market Strategy report, RHB Bank economist Chin Yee Sian stated that Malaysia’s April exports rose by 16.4 percent year-on-year, significantly higher than the 7.5 percent market consensus and its 10.3 percent projection. However, she noted that the momentum might not be sustainable.
Chin emphasized that, despite recent developments in the de-escalation of trade tensions, driven by progress in US-China talks, it is important to remain cautious against premature optimism. In the near term, exports, especially to the US, might receive a temporary boost from front-loading during the 90-day US tariff pause. Nevertheless, lingering uncertainty and potentially weaker global demand could continue to weigh on Malaysia’s trade performance in the coming months.
The tariff suspension is scheduled to expire on July 8, and there is no clear indication whether the exemption will be extended to other economies beyond China and the United Kingdom. Chin expressed concern about further uncertainties, particularly if US President Donald Trump raises universal tariffs to 20 percent from the current 10 percent. Additionally, proposed US tariffs on Chinese imports stand at 30 percent, which is still short of the 60 percent target Trump highlighted as a key pillar of his 2024 re-election campaign.
Chin indicated that the 10 percent US tariff on Malaysian goods, potentially rising to 24 percent after the 90-day suspension, positions Malaysia as a direct target of US tariff policy. Slower growth in major economies and lingering uncertainties over tariff tensions, especially after the 90-day pause period, pose significant downside risks to Malaysia’s trade and economic outlook, prompting a more cautious stance.
She also highlighted that export-oriented sectors reliant on demand from the US and China, such as electrical and electronic products, crude materials, and machinery, are likely to be hardest hit by direct US tariffs and broader trade tensions.
Despite these external uncertainties, Malaysia’s efforts to diversify export markets and strengthen trade pacts such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and Regional Comprehensive Economic Partnership are strategic steps to reduce reliance on any single market and boost regional cooperation. Malaysia’s neutral stance in trade and geopolitical matters allows it to avoid being directly impacted by conflicts between major economies, positioning the country to benefit from diversified trade relationships.
These factors help insulate Malaysia from the full impact of global trade tensions and tariff policies, fostering a more resilient economic outlook. CPTPP and RCEP are multilateral trade agreements aimed at reducing tariffs, enhancing market access, and strengthening economic integration among member countries across the Asia-Pacific region.