KUCHING: The reciprocal tariffs announced by the United States will have a limited impact on Sarawak's economy and trade relations, says Datuk Dr Malcolm Mussen Lamoh.
The state Deputy International Trade, Industry and Investment Minister said this is because Sarawak's exports to the US amounted to RM1.2bil in 2023.
"This only contributed 0.9% to Sarawak's total exports, with the main product being ferroalloy," he told Johnichal Rayong (GPS-Engkilili) during question time in the Sarawak Legislative Assembly on Tuesday (May 20).
Last month, the US imposed a 24% reciprocal tariff on Malaysian imports as part of higher tariffs against multiple countries before announcing a 90-day pause on the new rates.
Mussen also said Sarawak's main export market is Asia, comprising 73.4% of the state's total exports.
He said the state's main exports were liquefied natural gas (LNG), petroleum, palm oil, and aluminium, amounting to RM102.6bil in 2023.
"The reciprocal tariff is expected to have minimal impact on Sarawak's trade relations with key Asian partners, including China, India, Japan, and South Korea. These countries remain our major trading partners.
"Trade continues to be strengthened through various free trade agreements (FTAs). Sarawak will utilise these FTAs to diversify and broaden our export markets," he said.
Regarding the state's key commodities, Mussen said LNG is predominantly exported to Japan and China, palm oil to China and India, and petroleum to Peninsular Malaysia, Australia, and Thailand.
"As a result, Sarawak's trade flows remain resilient, supported by its trade relations, which are focused on other countries," he said.
In addition, he said Sarawak would refine its economic policies in line with proactive measures taken by the Federal Government to address the impact of the reciprocal tariff.
These measures include strengthening trade partnerships, diversifying export markets while enhancing supply chain resilience, investing in strategic industries, and exploring bilateral trade agreements to safeguard economic stability.
"Sarawak will continue to capitalise on our strengths and foster deeper partnerships to enhance resilience and sustain growth despite market uncertainties," he said.
Mussen added that Malaysia, as the chair of Asean, would work collaboratively to strengthen the regional bloc's influence in negotiations with the US.
He said discussions would focus on charting a way forward and mitigating potential disruptions to regional trade, supply chain, and cross-border investments.
