Malaysia plans to engage with the United States over President Donald Trump's proposed tariffs on chip imports, warning that such measures could harm businesses in the Southeast Asian nation.
Malaysian Minister of Investment, Trade, and Industry Zafrul Aziz announced he will visit the U.S. in the second quarter of 2025 to negotiate a way forward that benefits both countries. "We are concerned about whether semiconductors will be subject to tariffs or export restrictions," Zafrul said. "Engagement is key, but if tariffs are imposed, it will certainly be detrimental to Malaysian companies."
The U.S. is Malaysia's third-largest market for semiconductor exports. Trump recently indicated he might impose a 25% tariff on imports of automobiles, semiconductors, and pharmaceuticals, with an announcement potentially coming as early as April 2. In 2024, Malaysia pledged to invest at least 25 billion ringgit (USD 5.7 billion) to support its semiconductor industry, aiming to bolster stability amid global supply chain disruptions caused by tensions between China and the U.S. The country’s semiconductor sector targets doubling its export revenue to 1.2 trillion ringgit by 2030, reinforcing its position as the world's sixth-largest chip exporter.
Malaysia serves as a critical regional hub in the global supply chain, hosting multiple chip packaging facilities for major firms like Intel, GlobalFoundries, and Infineon Technologies. According to Zafrul Aziz, most companies exporting semiconductors from Malaysia are American firms, which remain deeply integrated into the U.S. supply chain.
