KUALA LUMPUR (Reuters) -Malaysia’s exports will be impacted more by global economic growth and trade than by currency fluctuations, its trade minister said on Tuesday, while flagging a potential slowdown in outbound shipments.
Trade Minister Tengku Zafrul Aziz said exports rose significantly in the first quarter of 2025 as companies were frontloading orders to get ahead of U.S. tariffs, which were announced by President Donald Trump in early April.
“What will support the exports more is actually the growth of the global economy and the growth of global trade … more so than the currency fluctuation,” Tengku Zafrul said at a press conference.
Malaysia’s exports rose a better-than-expected 6.8% in March from a year earlier, with shipments to the United States rising to a record high of 22.66 billion ringgit ($5.4 billion).
Tengku Zafrul said the “dramatic increase” in exports mainly included purchases in electrical and electronic products from U.S. buyers “looking at stocking up due to the possible increase in tariffs”. However, he said the growth in exports was unlikely to remain as strong moving forward.
Malaysia’s exports are projected to rise 5.2% in 2025, moderating from a 5.7% expansion in 2024.
Malaysia is facing a 24% tariff rate in July for exports to the U.S., unless an agreement is struck between the two countries. The Southeast Asian nation has said it is open to negotiating with the U.S. on non-tariff barriers, reducing its bilateral trade surplus, and exploring a bilateral trade agreement.
Prime Minister Anwar Ibrahim said on Monday there was a possibility that Malaysia can negotiate a reduction in threatened U.S. tariffs as Washington has agreed to further talks.
Tengku Zafrul said Malaysia’s objective is to reduce the tariff to zero, adding that the U.S. wants Malaysia to resolve trade imbalances and non-tariff barriers, as well as safeguard U.S. technology from transhipment smuggling.
Malaysia’s trade ministry will now be the sole issuer of certificates of origin for exports to the U.S. to prevent illicit transshipment through Malaysia, Tengku Zafrul added, without specifying which countries such illicit shipments originated from.
The ministry will also enhance audits of exporters’ applications and strengthen investigations to curb any transshipment offences to the U.S.
($1 = 4.2290 ringgit)
(Reporting by Danial Azhar; Editing by John Mair and Kim Coghill)
