Malaysia defends Trump trade deal after critics warn it will compromise country’s sovereignty | Malaysia
Malaysia’s government has been forced to defend its new trade deal with the US after opposition politicians, analysts and civil society groups warned that the deal was “one-sided” and could jeopardize the country’s sovereignty.
Minister of Investment, Trade and Industry Tengku Zafrul Aziz described the trade agreement as “the best possible outcome for Malaysia”.
“This is the geopolitical reality we face as a freely trading nation engaging with the world’s largest economic power, which is also our largest trading partner,” Aziz said.
Critics of the deal include former Malaysian prime minister Mahathir Mohamad, a trade nationalist and the country’s longest-serving leader, who said provisions in the agreement amounted to a “handing over” of the country’s independence.
Mahathir, Prime Minister Anwar Ibrahim’s political rival, said last week: “We agree to buy their planes, their gas and their machinery, to follow their digital rules, to have the first bite of our rare earths, to open our market on their terms and to follow their terms on who we can and cannot do business with.”
The agreement, signed during Donald Trump’s visit to Kuala Lumpur last week, saw Malaysia agree to eliminate or reduce tariffs on some US goods, while the US promised to keep tariffs on Malaysian products at 19 percent, except for a list of items that will receive a zero percent reciprocal duty rate.
The government hailed the deal as a win for attracting more investment and expanding trade with the United States.
But public discourse has focused on a clause of the agreement issued by the White House, which states that Malaysia must align with the United States on economic restrictions or sanctions against a third country.
Opposition politician Azmin Ali claimed that the clause would mean that “if Washington decides to block imports from China or Russia, Malaysia must do the same even if it hurts our economy.”
Azmin, the former international trade and industry minister, said this would force Malaysia to take sides in other people’s conflicts and take away “the neutrality that has long been our strength”.
Politicians from across the political spectrum, including some MPs in Anwar Ibrahim’s ruling coalition, as well as analysts and civil society groups, have also expressed concerns.
Elina Noor, Senior Fellow in the Asia Program at the Carnegie Endowment for International Peace, told the Guardian that she agreed with Mahathir that the agreement was extremely one-sided, but disagreed that it violated constitutional provisions.
“With this U.S. deal, Malaysia will need to work extra hard to ensure it is no longer trapped by other countries’ constraints,” Noor said, adding that the country must be “diligent in not sleepwalking through long-term, strategic alignment against its own interests.”
The Malaysian Anti-Corruption and Nepotism Center (C4 Centre) issued a statement expressing concerns that the bilateral deal also risks bypassing procurement laws and putting investments out of oversight.
“This gives us the right to decide on some issues,” said Pushpan Murugiah, chief executive officer of C4 Center.
“There are certain clauses that require that if we take actions that will affect the interests of the United States, we must first obtain permission.”
Ministry of Investment, Trade and Industry quickly microsite and publish a 15-page Frequently Asked Questions (FAQ) to address concerns. The government’s chief legal counsel also said Malaysia could unilaterally terminate the agreement at any time.
A special parliamentary committee is planned to be established next week to review the bilateral agreement.
