Malaysia retains US tariff exemption for semiconductor exports
Minister Johari Abdul Ghani said excess production capacity remained unresolved in Section 301 negotiations with Washington.
Malaysian semiconductor exports remain exempt from US tariffs, Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said on October 13. He said Washington had given Malaysia no indication that it would introduce tariffs on those exports.
Speaking to reporters at the European Union-Malaysia Business Day 2026: Selangor in Focus in Kuala Lumpur, Johari said talks with the US under Section 301 addressed forced labour, excess production capacity, environmental standards and government subsidies.
Johari said the forced labour matter had been settled, with Malaysia facing a 10 per cent rate against 12.5 per cent for other countries. He said only 17 economies had been assigned the 10 per cent rate. Malaysia faced no measures concerning environmental standards or state subsidies, he added.
Excess capacity was the sole outstanding matter, according to Johari, who said Malaysia had no such capacity. He said any excess linked to Malaysian exports could originate in third countries. Malaysia would ask Washington to identify the countries concerned and remove them from its list.
Johari also said exporters needed to comply with the laws and requirements of their destination markets, pointing to the EU’s strict environmental standards. At the same event, EU Commissioner for International Partnerships Jozef Sikela said joint investment with Malaysia would help diversify the semiconductor ecosystem, while renewed Malaysia-EU Free Trade Agreement negotiations would deepen economic ties.
