M'sia committed to buying 30 more Boeing aircraft worth US$9.5b from US

Malaysia is committed to purchasing an additional 30 Boeing aircraft in the second phase, said Investment, Trade and Industry Minister Tengku Zafrul Abdul Aziz.

He said the purchase of the additional aircraft was part of reciprocal negotiations between Malaysia and the United States.

“In addressing trade deficit with the US, the government will make major procurements including the purchase of Boeing aircraft.

“Malaysia Aviation Group (MAG) is committed to purchasing 30 Boeing aircraft valued at US$9.5 billion (RM40.6 billion) in the first phase and an additional 30 Boeing aircrafts valued at US$9.5 billion for the second phase,” he said during a special press conference regarding the tariff announcement by the US.

The US had earlier announced a reduction in tariffs on Malaysian exports to 19 percent from the announced 25 percent.

Previously, MAG had announced the purchase of new Boeing aircraft to strengthen Malaysia’s position as a major player in the global aviation industry.

MAG had announced the acquisition of 30 new aircraft directly from Boeing as part of its aircraft modernisation strategy.

The order includes 18 Boeing 737-8s and 12 Boeing 737-10s powered by CFM LEAP-1B engines with an option for 30 more 737s.

The orders for hundreds of Boeing jets were announced through deals with Japan, the United Arab Emirates, Indonesia, Cambodia, Bangladesh and other countries as part of negotiations to reduce US tariffs.

Tariff exemption for semiconductor, pharmaceutical exports

In a related development, Zafrul said semiconductor and pharmaceutical exports to the US are exempt from the 19 percent tariff for now.

Describing the outcome as a win-win result for both countries, Zafrul, however, said the US is still studying its trade laws to determine if the zero tariff on these sectors is fair.

He said the timeline for the review is December this year.

“Assume by December, but it could be earlier,” the minister told a press conference today.

“We look at this as a win-win (decision) for both Malaysia and the US. This also reflects strong bilateral relations between the two countries,” he said.

Zafrul also revealed that following the negotiations, Malaysia will impose a zero percent tariff on 6,911 products imported from the US.

Of that, 191 new tariff lines are from the agriculture sector while 1,347 are from the industrial sector.

This is about 61 percent of the total 11,260 tariff lines requested by the US, he said.

- Bernama

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