No winner in tariff spat, says ex-Bank Negara assistant governor

There will be no winner in the US’ sweeping global tariffs and similar responses from other countries, and the only way forward is through negotiation to minimise the damage, said a former Bank Negara Malaysia assistant governor.

Andrew Sheng explained that the disagreement between US President Donald Trump's trade adviser, Peter Navarro, and business tycoon Elon Musk highlights the controversy surrounding the tariff issue, both within the US and internationally.

“The key issue is who will pay the tax?"

"It will be the American consumers and companies. The negotiation is not just with foreign countries; there is also a major internal debate in the US on who will pay for it,” said Sheng (above), who is the chairperson of the George Town Institute of Open and Advanced Studies and a Distinguished Fellow of the Institute for Capital Market Research.

It is to be noted that Asean’s Indochina member states were the hardest hit by the tariffs, with Cambodia facing combined baseline and retaliatory duties totalling 49 percent, followed by Laos (48 percent), Vietnam (46 percent), and Myanmar (44 percent), which took effect today.

Thailand was subjected to tariffs of 36 percent, Indonesia 32 percent, Brunei and Malaysia both 24 percent, and the Philippines 17 percent, while Singapore faced a baseline tariff of 10 percent.

Open trade system

Speaking on the sidelines of the Asean Investment Conference 2025 today, Sheng noted that Malaysia has an open trade system, and the key to navigating these tariffs lies in ensuring the quality of its products and services.

“In the semiconductor sector, the chips themselves are exempt. What is less clear is how much the equipment used to manufacture chips - which Malaysian companies excel in - will be affected.

“But it is not so simple because who is the major importer of Malaysian equipment? It is not Malaysians; it is the American companies.

“So it is really up to the American companies to negotiate with the US government, less so for Malaysian companies to negotiate with the Malaysian government,” he said.

Sheng emphasised that Malaysia has a significant opportunity to negotiate with the US on this matter.

Investment, Trade and Industry Minister Tengku Zafrul Abdul Aziz is set to lead Malaysia’s delegation to Washington at the end of this month to discuss the tariffs imposed on Malaysia.

He will be accompanied by deputy trade secretary-general Mastura Ahmad Mustafa and other officials from the ministry.

Representatives from Malaysia's embassy in Washington will join also the delegation.

- Bernama

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