PETALING JAYA: The Reciprocal Trade Agreement (ART) between Malaysia and the United States is no longer applicable following a decision by the US Supreme Court to overturn most of the sweeping tariff measures introduced by US President Donald Trump.
Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said that under the agreement signed last October, Malaysia was expected to face a tariff rate of 19%.
However, he said Malaysia is currently only subject to a global tariff of 10%.
“At the moment, Trump is using Section 122 under the US Trade Act of 1974, which imposes a 10% tariff on Malaysia.
“So within this five-month period, the US will review whether it wants to use Section 301 to determine a new tariff rate,” he said during the Aidilfitri 2026 Contribution Programme in Desa Pandan on Sunday (March 15), according to a Sinar Harian report.
Johari had previously said that Malaysia was closely monitoring the latest developments in US trade policy, including assessing the scope and implications of the Trump administration’s decision to impose a 10% tariff on imported goods from all countries.
He added that Malaysia has yet to ratify the ART, even though the agreement was signed in October last year.
Meanwhile, Johari said the US would assess four key factors before determining the new tariff rate.
These include the possibility of Malaysian products flooding the US market, the use of forced labour in production processes, and the employment of illegal or underage workers.
Environmental protection is also among the criteria being considered.
“Similar to environmental assessments imposed by Europe, the US also takes environmental factors into account, including activities that damage the environment.
“Fourth, they want to examine whether a country’s government provides subsidies to exporters,” he added.
