Malaysia-US reciprocal trade pact yet to take effect as Putrajaya seeks written assurances — Anwar
The Edge Malaysia - 20 January 2026
Malaysia-US reciprocal trade pact yet to take effect as Putrajaya seeks written assurances — Anwar
By Choy Nyen Yiau
Prime Minister Datuk Seri Anwar Ibrahim clarified on Tuesday that the Agreement on Reciprocal Trade (ART) between Malaysia and the US has yet to come into force, despite having been signed nearly three months ago.
Anwar revealed that Malaysia is still seeking clarification and adjustments to several clauses in the agreement, adding that discussions are ongoing.
“(For some clauses,) we have received assurances through discussions between the United States Trade Representative (USTR) and the Minister of Investment, Trade and Industry. However, we believe it would be better for these assurances to be put in writing before we finalise the agreement. These are among the matters being addressed before the deal is concluded,” he told Parliament during Minister’s Question Time.
Anwar was replying to Ahmad Tarmizi Sulaiman (PN–Sik), who asked whether both nations had completed the formal exchange of notices required to finalise their respective domestic legal processes.
The ART was signed on Oct 26 last year on the sidelines of the 47th Asean Summit in Kuala Lumpur, during an official visit by US President Donald Trump. The agreement was proposed as a strategic mechanism to lower US tariffs on Malaysian products — reducing rates on certain goods from 25% to 19% — while addressing non-tariff barriers for US exporters.
The agreement has since drawn criticism from several quarters, including former prime minister Tun Dr Mahathir Mohamad, who warned that it could undermine Malaysia’s economic sovereignty by compelling Putrajaya to adhere to Washington’s trade and investment rules.
On Nov 3 last year, the Attorney General’s Chambers (AGC) said Malaysia has the right to terminate the ART at any time through written notice without requiring US consent, citing Article 7.5 of the agreement. The AGC added that the ART explicitly states that all protections under the agreement are intended to safeguard Malaysia’s sovereignty and national interests.
Separately, the AGC said Article 7.2 of the ART stipulates that the agreement will only take effect 60 days after both parties formally notify each other that these domestic procedures have been fulfilled.
On Tuesday, Anwar said any proposals for improvements or adjustments to the ART would be deliberated at the Cabinet meeting, adding that Malaysia has also engaged the US through several other channels to seek clarification. He added that there is no fixed schedule for the completion of the written notifications required for the agreement to come into force.
Separately, the prime minister said Malaysia will continue to exercise prudence in managing its international relations, following an announcement by US President Donald Trump on the imposition of a 25% tariff on countries doing business with Iran.
Anwar said he had personally engaged with Iranian leadership on two occasions, while several ministers had also been sent there.
However, he stressed that Malaysia cannot afford to take actions that could undermine national interests, without elaborating further.
“But as far as relations with Iran are concerned, we will continue to maintain ties and defend Iran’s rights and sovereignty. That is also a principle we uphold,” he added.
