Penang CM welcomes US tariff reduction as a boost for Malaysia and Penang’s export sector, calls for further trade concessions.

GEORGE TOWN, Aug 1 — Penang Chief Minister Chow Kon Yeow has welcomed the United States' decision to reduce tariffs on Malaysian imports from 25 per cent to 19 per cent, calling it a timely boost for the nation’s export sector—particularly Penang, which is active in key industries like electrical and electronics (E&E), manufacturing, and medical devices.

Chow said the move places Malaysia on a more equal footing with other ASEAN nations, helping to level the regional trade playing field.

“This is a welcome relief, especially for Penang’s export-driven industries. With the new tariff rate now more aligned with that of our ASEAN peers, it strengthens our regional trade position and enhances Malaysia’s overall trade competitiveness,” he told reporters today.

He made the remarks after launching the National Month and state-level Jalur Gemilang flag-raising ceremony, attended by Penang State Assembly Speaker Datuk Seri Law Choo Kiang, who also chairs the State Government Official Councils.

Chow was responding to reports that the US will implement a revised 19 per cent tariff on Malaysian imports effective August 1, 2025, a reversal from its earlier plan to enforce a 25 per cent tariff starting this year.

While acknowledging the positive impact of the reduced tariff, Chow stressed that Malaysia still faces intense competition from regional players enjoying lower or zero tariffs under various trade agreements.

“We are awaiting further clarification from the United States Trade Representative (USTR) and the Federal Government on which sectors will be impacted or stand to benefit,” he said.

Chow added that the Penang government has called on federal authorities to continue negotiations to secure deeper tariff concessions for strategic sectors, which are crucial to sustaining Malaysia’s role in the global supply chain and attracting high-value investments.

“The state government remains committed to supporting our local industries and exporters as they navigate the evolving global trade environment,” he said.

Chow also welcomed reports that US President Donald Trump may attend the upcoming ASEAN Summit, viewing it as a positive signal that trade disputes between both sides can still be addressed through diplomacy and cooperation.

“This tariff cut exceeded expectations and offers renewed optimism for the future of Malaysia’s international trade,” he added. — Bernama