KUALA LUMPUR – US President Donald Trump will impose a 19 per cent tariff on exports from Malaysia to the US, a lower rate than the 25 per cent levy he threatened in July.

The figure was set in an executive order that Mr Trump signed on July 31, ahead of an Aug 1 deadline he imposed for countries to negotiate trade frameworks with his administration.

The South-east Asian nation has been attempting to win favour with Mr Trump, including by cracking down on the smuggling of advanced semiconductors through Malaysia and helping to broker a ceasefire between Thailand and Cambodia. 

Malaysian Prime Minister Anwar Ibrahim’s government

wanted to secure a tariff rate below 20 per cent,

Datuk Seri Anwar had previewed the announcement on July 31, when he referenced a telephone conversation with Mr Trump and said the US leader would announce a tariff rate on Aug 1, Malaysian time.

In his address, Mr Anwar also said Mr Trump had thanked Malaysia for its role in helping mediate the recent conflict between Cambodia and Thailand over their shared border.

Malaysia’s Investment, Trade and Industry Minister Tengku Zafrul Aziz had said previously that there were several “red lines” the government would not cross in trade negotiations – such as sacrificing the country’s sovereignty or sidelining other trade partners as it sought to close a deal with the US. 

The tariffs are set to weigh on the economy, with the central bank this week cutting its growth forecast range to 4 per cent to 4.8 per cent, from 4.5 per cent to 5.5 per cent amid the uncertainty.

Mr Zafrul had earlier warned that the US levies would affect the economy for years to come. At...