This August, prices of goods may explode. Wages won't rise, but Trump's tariffs increase by 24% — is Malaysia ready or about to drown?
More than RM199 billion worth of Malaysia-US trade is now in the danger zone as US President Donald Trump threatens to reimpose a brutal 24% tariff on imports from Malaysia once the 90-day grace period expires.
For now, the tariff rate remains at 10%, but concerns are growing – especially if Trump chooses to 'step on the gas pedal' with maximum tariffs.
Last year alone, Malaysia's exports to the US amounted to more than RM199 billion, equivalent to 13% of the country's total exports.
If the 24% tariff is implemented, not only will investors and manufacturers suffer huge losses, but the people themselves may have to pay more for daily necessities.
Here are the 7 sectors most affected by the tariffs that Trump is set to impose:
Electrical & Electronics (E&E)
Export value to the US: RM117 billion
Products: Chips, semiconductors, transformers, batteries, broadcast equipment
Risk: Although semiconductors are currently exempt from tariffs, they account for almost 50% of E&E exports to the US. If this exemption is withdrawn, component prices will rise, including phones, computers and electrical appliances.
Estimated price increase: 10-30% for consumer electronics in the local market.
Impact on the country: Potential loss of investment from multinational companies, in addition to disruption of global supply chains.
Machinery & Mechanical Equipment
Export value to the US: RM29.3 billion
Products: Computers, water pumps, industrial printers, machine parts.
Risk: The US is the largest buyer of this sector. Tariff increases could cause Malaysian manufacturers to lose competitiveness compared to countries such as Vietnam or Mexico.
Estimated price increase: 15-25% for Malaysian-made parts and machines.
Impact on the country: Reduced export orders, thus affecting employment opportunities in the manufacturing sector.
Medical & Optical Instruments
Export value to the US: RM16.2 billion
Products: Medical devices, oscilloscopes, chemical analysis equipment
Risk: Malaysia is the world leader in oscilloscope exports, and the US is the main buyer. If tariffs are imposed, US hospitals and laboratories may choose suppliers from other countries.
Estimated price increase: 15-20% for medical equipment.
Impact on the country: Potential loss of market advantage and investment opportunities in high-tech fields.
Furniture & Lighting
Export value to the US: RM7.2 billion
Products: Kitchen cabinets, beds, wooden chairs
Risk: The Malaysian furniture industry is highly dependent on the US market. Rising costs could cause companies to scale down operations or move to other markets.
Estimated price increase: 20-30% for Malaysian-made furniture in the US – could affect demand.
Impact on the country: Risk of job losses in rural areas and producing states such as Johor, Selangor, Perak and Sarawak.
Rubber Products
Export value to US: RM1.6 billion
Products: Medical gloves, Industrial rubber
Risk: Gloves are the main product exported to the US. Large companies such as Top Glove and Hartalega may be affected in terms of profit margins.
Estimated price increase: 10-15% for gloves – costs may be passed on to hospital users.
Impact on the country: Pressure on local companies to reduce costs, risking workers' wages and jobs.
Metals (Aluminium, Steel, Copper)
Export value to the US: RM5 billion
Products: Aluminium, iron, zinc, tin
Risk: The US has long imposed heavy tariffs on Chinese metals. If Malaysia is subject to similar tariffs, exports will decline.
Estimated price increase: 10-20% for metal-based products made from Malaysian materials.
Impact on the country: Exporters may suffer heavy losses, especially small and medium-sized companies that have no alternative markets.
Petroleum & Mineral Fuels
Export value to US: RM2.5 billion
Products: Crude oil, refined gas
Risk: The US is a small buyer compared to China and Singapore, but if tariffs are imposed, it will still reduce profit margins.
Estimated price hike: Small impact on local prices, but exports to the US could fall by up to 30%.
Impact on the country: Decrease in national income through Petronas and other producers.
This is not just an export issue — it is a matter of the survival of the country’s economy.
When prices of goods rise, investments fall, and strategic sectors are paralyzed… the people will bear the brunt, from homes to markets, from factories to hospitals.
Malaysia cannot continue to rely on the mercy of external markets without a firm plan of action.
We need an emergency trade strategy, incentives to encourage domestic investment, and strengthening regional markets if we are to survive in this era of “new trade wars.”
Between the moment tariffs are implemented and the time strategies are formulated — whoever moves first will be safe, whoever is slow will drown in the trade war tide!
