Malaysia not obligated to adopt US trade restrictions, says Miti

Trade minister Tengku Zafrul Aziz rebuffed his predecessor Azmin Ali’s claim that the reciprocal trade deal with the US undermined Malaysia’s sovereignty.

PETALING JAYA: Tengku Zafrul Aziz has defended the Malaysia-US Reciprocal Trade Agreement, saying Putrajaya is not obligated to emulate the US in imposing customs duties, prohibitions or import restrictions on goods and services from other countries.

In a Facebook video last night, the investment, trade and industry minister slammed Perikatan Nasional secretary-general Azmin Ali for selectively citing certain provisions in the deal signed with the US on Sunday, particularly Article 5.1.

Tengku Zafrul said Putrajaya is only obligated to impose restrictions on other countries to address economic or national security concerns “shared” by both countries.

He said the word “shared” in the provision was crucial.

“This means that if a certain issue only affects the economic or national security of the US but has no impact on Malaysia’s economic or national security, we do not need to consider (emulating the US),” he said.

Separately, DAP’s Syahredzan Johan also criticised detractors of the deal for “cherry-picking” provisions to suit their narratives.

He said an objective and thorough reading of Article 5.1 shows that contrary to claims that the agreement strips Malaysia of its autonomy and sovereignty, it actually “promotes mutual cooperation in pursuit of shared interests”.

“This last part proves that unlike the claims of some quarters, Malaysia does not have any obligation to blindly impose restrictions on third countries merely because the US has done so.

“Clauses and articles must be read in their entirety and should not be selectively quoted merely to further one’s political agenda,” he said in a Facebook post.

On Monday, Azmin criticised the deal as possibly undermining the country’s economic sovereignty, claiming it forces Putrajaya to follow Washington’s rules and regulations surrounding trade and investment.

The former trade minister said one of the deal’s most damaging clauses was Article 5.1, which he claimed “requires” Malaysia to copy any US trade restrictions or sanctions against other countries.

Under the Malaysia-US Reciprocal Trade Agreement, Malaysia has committed to providing significant preferential market access for US industrial goods exports, including chemicals, machinery and electrical equipment, metals and passenger vehicles, as well as for agricultural exports such as dairy products, poultry and rice.

The US, meanwhile, will maintain a 19% reciprocal tariff on Malaysian goods, with certain products receiving a 0% tariff rate under a list of aligned partners.

Malaysia will refrain from banning or imposing quotas on exports to the US of critical minerals or rare earth elements and will partner with American firms “to create certainty for businesses to increase production capacity”.