US–Malaysia Trade Deal Sparks Sovereignty Concerns

At the ASEAN summit in Kuala Lumpur, the United States and Malaysia signed an Agreement on Reciprocal Trade that keeps a unilateral 19% U.S. tariff while granting exemptions for 1,711 Malaysian products — including palm oil, rubber, cocoa, aircraft parts and pharmaceuticals — to protect export markets and avert retaliatory tariffs. Malaysian ministers said the exemptions secure continued market access worth about RM22 billion for those lines; Malaysia reported exports to the U.S. of RM166.38 billion for Jan–Sept 2025 and total bilateral trade of about RM325 billion in 2024. The pact prompted controversy over an Article 5.1 clause alleged to require alignment with U.S. trade restrictions, but Prime Minister Anwar Ibrahim and Trade Minister Tengku Zafrul defended the deal, saying built-in guardrails preserve neutrality and that parliamentary hearings will review concerns. Industry groups such as the Malaysian Palm Oil Council welcomed the tariff relief as strengthening Malaysia’s role in U.S. supply chains, while critics called the agreement one-sided. The Malaysia agreement was part of a broader set of U.S. reciprocal deals and frameworks unveiled at the summit covering roughly two-thirds of U.S.-ASEAN trade and coincided with a U.S.-China framework effort observers say may help head off a wider trade war.