US Ambassador affirms Malaysia’s economic sovereignty after trade agreement signing

Lol.

“Investment creates jobs in both countries, and jobs in the US pay twice the average Malaysian wage. So, having American companies and investments here will really benefit the people,” said Kagan.

Only twice as much? I remember the days when Western countries (and Singapore) would pay around 3x-4x. I guess those days are behind us.

What Washington’s ‘due consideration’ means for Malaysia’s RM32.8 billion semiconductor industry

Not sure about the collective amnesia people have to think that for critical sectors that the US can’t produce, that they’ll make it even more difficult for American companies based here. Also considering that I assume backroom guarantees have been made which had provided the greenlight for US investments to surge here within their own conditionalities of course.

According to Investment, Trade and Industry Minister Datuk Seri Tengku Zafrul Abdul Aziz, the exemptions are valued at US$5.2 billion (RM21.96 billion), accounting for roughly 12 per cent of Malaysia’s total exports to the US.

All that for just a 12% exemption

The US has recently overtaken China as Malaysia’s largest export market and remains its top foreign investor, with total investments reaching RM32.8 billion in 2024.

“In terms of benefit to the Malaysian industries, with a lower import tariff, US products can enter the Malaysian market easily and will be more competitive. This will make high-quality products such as medical equipment, computer hardware and machinery spare parts more affordable for Malaysian businesses and consumers,” Zafrul said.

He added that Malaysian manufacturers could use advanced US machinery and automation tools as inputs to enhance productivity and move up the industrial value chain, aligning with the goals of the National Industrial Master Plan (NIMP).

Crazy cope. Just say the US demanded and you had to concede.

When asked about the long-term reliability of the deal, especially given Trump’s history of abrupt policy shifts, Zafrul replied confidently. “For us (Malaysia), an agreement is an agreement,” he said.

Lol.

By securing tariff exemptions and reaffirming its commitment to stable export policies, Malaysia strengthens its position as a preferred investment destination in the region, a move that could attract even more multinational corporations to establish advanced manufacturing and R&D (research and development) operations in the country.

Sinar Daily is one of the largest Malaysian Chinese language newspapers that also have an English-language column. Fascinating to see what the centrist-liberals think is “good for business”.

Out in the real world:

Malaysia defends US trade pact dubbed ‘act of surrender’ amid sovereignty concerns

Mr Zafrul said the controversial Article 5.1 in the deal does not oblige Malaysia to adopt Washington’s policies, as “guardrails” within the broader text protect national interests. According to him, Malaysia is required to discuss such matters with the US and act only “if necessary”, in line with domestic laws and within a prescribed timeline.

“The provision also stressed that any actions taken by Malaysia have to be on issues of shared economic concern – that is, a shared problem for both Malaysia and the US,” he said.

But Mr Azmin Ali, a former international trade and industry minister, disagreed. The secretary-general of opposition pact Perikatan Nasional called Article 5.1 the “most damaging clause” in the agreement, saying it forces Malaysia to take Washington’s side in its conflicts.

“If Washington decides to block imports from China or Russia, Malaysia must do the same, even if it harms our economy,” said Datuk Seri Azmin in a statement.

“By aligning Malaysia’s policies with US decisions, the agreement risks driving away investors who value Malaysia’s neutrality and stability.” Similar concerns were raised on Oct 28 by the parliamentary select committee on international relations and trade, which announced a hearing on Nov 12 to review the agreement.

Dances with Wolves: Has Malaysia traded Sovereignty for Symbolism?

This ones a longer piece where I recommend reading the entire thing.

The most consequential parts of the pact are buried in the technical annexes and memoranda: – Malaysia agrees not to impose bans or quotas on exports of critical minerals and rare earth elements to the US; – Malaysia will align its supply-chain governance for those minerals with US standards; – Malaysia commits to “non-discriminatory access” for US firms in its semiconductor and critical-minerals sectors.

This is the quiet part of the “Comprehensive Strategic Partnership” upgrade: Malaysia’s critical sectors — minerals, semiconductors, data infrastructure — are now tethered to American geopolitical priorities. That is not the loss of sovereignty in the textbook sense, but it is a substantial narrowing of Malaysia’s freedom to chart its own economic course.

…Compare this with Japan and South Korea, both longstanding US allies. Their economic ties with the US are deep and institutional, not transactional. They operate within long-term industrial frameworks, joint R&D ventures, and multilateral trade architectures like the CPTPP and RCEP. Neither Tokyo nor Seoul was ever asked to sign one-off, multi-billion-dollar purchase pledges as a prerequisite for “strategic partnership.”

China’s model is different again. Beijing engages through investment, infrastructure, and market access — large but patient capital flows into ASEAN, backed by upgraded ASEAN–China FTA commitments. While Chinese financing can carry its own dependencies, it rarely comes with policy dictates about export controls or supply-chain compliance. The contrast is stark: China seeks markets and infrastructure routes; the US seeks supply-chain alignment and political conformity.