SUBANG: Malaysia is currently observing the development of the US’ decision to impose a new import tariff on steel and aluminium, in terms of reactions from the affected countries.
Second International Trade and Industry Minister, Datuk Seri Ong Ka Chuan, said the government wanted to be prudent on the matter as the US has been one of the country’s biggest trading partners.
“We cannot afford to have a bad relationship with the US. But if they continuously impose higher taxes that affect Malaysia’s export to the US, then we may have to think of a solution to the problem,” he told reporters at the ‘Industrial Park Forum for Central Region’ yesterday.
He said Malaysia appreciated the US – the world’s biggest economy – as its trading partner, and that the country is making every effort to ensure that the future trade policy between Malaysia and US would not affect the inflow of Malaysian products into the US and vice-versa.
Ong said Malaysia was not majorly affected by the imposition of the import tariff for now as steel and aluminium were not major trading items between two countries.
“In 2017, our total trade with the US stood at RM158.1 billion, with exports at RM88.69 billion and imports at RM69.32 billion,” he said.
The trade comprised electrical and electronic products (55.4 per cent, RM49.14 billion), rubber products (6.9 per cent, RM6.11 billion), optical and scientific equipment (6.3 per cent, RM5.5 billion), other manufacturing products (5.6 per cent, RM4.97 billion) and wood-based products (four per cent, RM3.4 billion).
For 2017, he said, steel and aluminium exports to the US stood at only 0.2 per cent.
Ong said the US’ decision was unfortunate, as the world has been moving towards establishing open and free markets, and imposing higher tax was something that was not compatible with that.
“Once you do this, other countries will definitely retaliate, which could start a trade war.
“The worst part is, we are currently promoting e-commerce trading, a platform to facilitate the free-flow of trading items. The imposition of import taxes would defeat the purpose of e-commerce and other free and open market trading initiatives,” he said. — Bernama