KUALA LUMPUR: The Federation of Malaysian Manufacturing (FMM) has urged the government to ramp up diplomatic efforts and introduce domestic policy measures to counter the impact of new US tariffs on Malaysian exports. The US recently announced a 25 per cent blanket tariff set to take effect on Aug 1, 2025, raising concerns for local manufacturers.
FMM president Tan Sri Soh Thian Lai stressed the need for immediate intervention to delay the tariff implementation and secure long-term exemptions. He warned that the new levy would strain businesses, particularly those with tight margins or fixed supply contracts.
“Malaysia’s case must be urgently elevated at the highest levels of US policymaking, supported by strong data and strategic positioning that highlight our value to US supply chains,“ Soh said.
Domestically, he proposed financial relief for affected industries, enhanced export promotion, and structural reforms to boost competitiveness. Key recommendations include raising the Market Development Grant ceiling, waiving MATRADE fees for trade missions, and offering incentives for branding and digital market access.
Soh also emphasised the need for productivity-driven growth through Industry 4.0 adoption, supported by tax incentives and digitalisation grants for SMEs. Workforce upskilling and reinvestment of foreign worker levies into apprenticeship schemes were also highlighted as crucial steps.
On a regional level, he suggested leveraging Malaysia’s ASEAN chairmanship to form a Supply Chain Coordination Council, strengthening intra-ASEAN trade resilience. Additionally, accelerating free trade agreements with the EU and emerging markets was deemed vital to diversify Malaysia’s trade base.
The FMM further called for a review of the SST structure, proposing B2B service tax exemptions for licensed manufacturers to ease supply chain costs. - Bernama
