Malaysia Continues Negotiations with the US, ART Agreement Still Not Officially Approved
KUALA LUMPUR โ Malaysia will continue negotiations with the United States (US) to ensure the country's interests are maintained, even though the Trade Agreement (ART) signed between the two countries has not yet been officially ratified. Minister of Investment, Trade and Industry, Datuk Seri Johari Abdul Ghani said the government chose a negotiation approach because the Malaysia-US trade relationship has a significant impact on the country's economy and the competitiveness of local products in the international market.
"The ART agreement between Malaysia and the United States, signed on October 26 last year, has not yet been ratified (officially approved) by both parties. The government through MITI will continue negotiations with the US Office of the United States Trade Representative (USTR) to ensure Malaysia's interests and views are given due consideration," he said during a question-and-answer session in the Dewan Rakyat today.
He said this while answering a question from Datuk Seri Hamzah Zainudin (PN-Larut) regarding the current status of the implementation of the ART between Malaysia and the US. Johari said that this development occurred after the US Supreme Court (SCOTUS) ruled on February 20 that the retaliatory tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were unlawful under the law.
Following this decision, the US government introduced a temporary global tariff of 10 percent on imported goods under Section 122 of the 1974 Trade Act, which can only be enforced for 150 days, starting from February 24 until expected to end on July 24. Johari said the government took a negotiation approach because unilateral trade actions by the US could affect the competitiveness of Malaysian exports if tariffs were imposed at higher rates.
"When we trade with a major economic power like the United States, we need to look at the bilateral trade interests. In the past 10 years, our trade volume reached approximately RM516 billion, and last year alone was almost RM98.6 billion. If we did not engage at that time, it is likely that the tariffs imposed would not be 15 percent, but could reach up to 40 percent as happened to some other countries," he said.
According to him, higher import tariffs would cause Malaysian products to lose competitiveness in the US market because the additional costs would eventually increase the selling prices for consumers in the country. He said this situation could affect local export companies that depend on the US market.
"When tariffs are imposed, our products will become less competitive. That is why we need to continue negotiating and ensure the country's trade interests are always maintained. When trading with an economy worth tens of billions of dollars like the United States, we need to look at the overall picture and make the best decisions for the country's interests," he said.
The Malaysian government is committed to continuing diplomatic discussions with the US to achieve a mutually beneficial agreement. The previously arranged ART agreement is seen as a strategic move to balance the bilateral trade relationship, but its implementation now depends on legal challenges in the US. Meanwhile, Malaysia also faces the possibility of additional tariffs related to forced labor issues, but negotiations continue to avoid negative impacts on the country's exports.
The SCOTUS decision that canceled the retaliatory tariffs under IEEPA has significant implications for US trade policy, including agreements already signed with Malaysia. However, the Malaysian government believes that the negotiation approach remains the best way to ensure national interests are protected in the face of global trade policy uncertainties.
*Original source: [kosmo.com.my](https://www.kosmo.com.my/2026/06/23/malaysia-terus-runding-dengan-as-perjanjian-art-belum-diluluskan-secara-rasmi/)*