KUALA LUMPUR, 5 May 2025 – The Federation of Malaysian Manufacturers (FMM) commends the strategic and forward-looking measures announced by YAB Prime Minister Dato Sri Anwar Ibrahim during a special sitting of Parliament to address the economic repercussions of the United States’ reciprocal tariffs upon Malaysian exports. These initiatives mark a clear commitment by the Government to shield Malaysian businesses from global trade disruptions while seizing new growth opportunities through diversification and enhanced regional collaboration.
FMM supports the Government’s proactive stance in expanding market access and enhancing export diversification. Of particular note is the timely resumption of the Malaysia-European Union Free Trade Agreement (MEUFTA) negotiations, alongside the RM50 million in additional funding allocated to MATRADE for export promotion in new and emerging markets such as the Gulf Cooperation Council (GCC), BRICS nations, South Africa, and Latin America.
“These efforts are especially critical at a time when exporters are rapidly repositioning away from the US market,” said FMM President Tan Sri Dato Soh Thian Lai. “Our recent survey indicates that over half of our members are prioritising market diversification as a key strategic response.”
To ensure maximum impact, FMM urges enhancements to the Market Development Grant (MDG), including higher funding caps for trade associations, removal of the RM25,000 collaboration fee with MATRADE, and the inclusion of product adaptation, certification, digital marketing, and market research as eligible activities. Empowering associations to play a more active role in targeted export promotion will accelerate SMEs’ access to non-traditional markets.
Regional and National Supply Chain Coordination
FMM is encouraged by the Government’s emphasis on strengthening intra-ASEAN trade and regional supply chain resilience, which aligns with Malaysia’s priorities as 2025 ASEAN Chair. FMM has proposed the establishment of an ASEAN Supply Chain Coordination Council (ASCCC) as a key regional deliverable to align trade, transport, customs, and investment policies across ASEAN.
The ASCCC would function at an operational level to support initiatives such as supply chain digitalisation, intra-ASEAN sourcing networks, crisis response protocols, and supplier matchmaking. Its creation would address current fragmentation and enhance ASEAN’s ability to respond cohesively to economic and geopolitical disruptions.
Domestically, FMM welcomes the Ministry of Investment, Trade and Industry’s (MITI) move to establish a National Supply Chain Council (NSCC). The Council would serve as a strategic platform to coordinate national responses to supply chain challenges. FMM stresses the importance of private sector involvement to ensure policies are grounded in industry realities.
Supporting Local Industry and Combating Unfair Trade
FMM fully supports efforts to boost SME access to Government Procurement (GP), calling for the urgent implementation of the GP Act to mandate a “Buy Made in Malaysia” policy across all levels of government. FMM also urges the inclusion of Government-Linked Companies (GLCs) under this initiative, backed by clear performance targets and transparent reporting mechanisms.
Additionally, FMM calls on the Government to take firm action against unfair trade practices, particularly the misuse of fraudulent Certificates of Origin (COOs). Effective enforcement of the Customs Act provisions is critical to preserving Malaysia’s reputation and shielding legitimate exporters from reputational and competitive harm.
Continued Collaboration Essential
FMM views the Government’s announcements as a positive step forward and calls for ongoing engagement between public and private sectors to ensure effective implementation. As the national voice of the manufacturing sector, FMM remains committed to working with all stakeholders to reinforce Malaysia’s position as a resilient, competitive, and globally integrated manufacturing and export hub.
