08/09/2026

TUESDAY | SEPT 8, 2026

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Ű BY HARITH KAMAL newsdesk@thesundaily.com

‘US blitz on illicit transshipment could affect local exporters’

SHAH ALAM: Malaysia must shed its dependence on technology developed by others and become a nation that creates, owns and masters its own technologies, said Prime Minister Datuk Seri Anwar Ibrahim yesterday. He said the country is at a crucial stage of its development and could no longer afford to remain merely a consumer of technology, particularly as it grapples with mounting challenges involving food and water security, energy, public health, climate change and artificial intelligence. “Malaysia is at an important point in its development journey. We cannot forever be consumers of technology created by others. We must become a country that creates, owns and masters technology.” Anwar said this in his speech read by Science, Technology and Innovation Minister Datuk Chang Lih Kang at the closing of the National Science Challenge (NSC) 2026. He said stronger scientific knowledge, evidence-based decision-making and a robust science, technology, engineering and mathematics (STEM) talent pipeline are critical to tackling these challenges and strengthening Malaysia’s global competitiveness. Anwar said while STEM enrolment rose from 40.95% in 2021 to 50.83% in 2024, enrolment in pure sciences remained low at about 15.8%. “This shows there is still a gap between interest in STEM and readiness to delve deeper into it.” PETALING Malaysian manufacturers could be caught in Washington’s crackdown on Chinese goods allegedly rerouted through third countries, with legitimate exporters potentially facing the same scrutiny as companies which are deliberately using Malaysia as a halfway house to evade US tariffs. Universiti Kebangsaan Malaysia Centre for Asian Studies head Dr Muhammad Faliq Abd Razak said the risk has become real after the White House classified Malaysia as a Tier 2 country in its latest assessment of alleged illicit transshipment. “It is a clear indication that greater scrutiny will be applied, and our industries must be prepared to demonstrate our compliance seamlessly.” The international trade and investment expert said the concern is particularly acute for Malaysian electronics, semiconductors and rubber products industries which routinely use parts and raw materials sourced from China. “In today’s globalised economy, it is entirely normal for a Malaysian factory to import intermediate components from China, add significant domestic value through manufacturing, and legally export the finished product to the US.” He said under Washington’s tougher scrutiny, making a product in Malaysia may no longer be enough to satisfy US customs authorities, with exporters potentially required to provide detailed evidence of where their components originated from and how much value was added locally. JAYA: Ű BY KIRTINEE RAMESH newsdesk@thesundaily.com

Anwar to chair MA63 Implementation Action Council meeting KOTA KINABALU: Prime Minister Datuk Seri Anwar Ibrahim is scheduled to chair the Malaysia Agreement 1963 (MA63) Implementation Action Council meeting at the Sabah International Convention Centre on Friday. Minister in the Prime Minister’s Department (Sabah and Sarawak) Datuk Mustapha Sakmud said Sarawak Premier Tan Sri Abang Johari Openg and Sabah Chief Minister Datuk Seri Hajiji Noor are also expected to attend the meeting which will be hosted by Sabah. “For everyone’s information, the MA63 Implementation Action Council meeting will be held on Sept 11, chaired by the prime minister and attended by the Sarawak premier, with our chief minister hosting the meeting. “There will also be a special MA63 session. I will address the relevant matters then,” he said when asked to comment further on MA63-related issues at a contribution presentation ceremony for fire victims at Kolej Tingkatan Enam Prauniversiti Kota Kinabalu yesterday. Mustapha said the meeting is one of the main platforms for discussing matters related to the implementation of MA63 between the federal government and the Sabah and Sarawak governments. – Bernama Muhammad Faliq said Malaysia need not choose between its economic relationship with China and access to the US market but it must make the origins of its products easier to verify. transshipment itself is not against any country’s laws as it is part of normal global business strategy. Abuse of the Certificate of Origin system to dodge import duties, however, is a separate matter that does breach regulations. Muhammad Faliq said simply rejecting the allegations would not be enough. He called for stronger industry self-policing, tighter controls over the issuance of Certificates of Origin, and independent reviews when specific allegations emerge. He said the issue goes beyond the immediate risk of tighter US customs checks as it could test Malaysia’s strategy of maintaining strong economic ties with China while positioning itself as a manufacturing hub serving Western markets. “Repeated allegations of transshipment threaten to undermine Malaysia’s hard-earned reputation as a strict, rules-based trading nation.”

Malaysia has repeatedly pushed back against US claims of unfair practice this year. In June, Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani disputed a separate US allegation that Malaysian manufacturers held excess production capacity. He said Washington’s concern may have stemmed from goods entering via third countries rather than genuine domestic overcapacity. Johari told Parliament that Malaysia continues to face several US trade actions under various American legal provisions, and that halting engagement with Washington would only expose the country to greater economic risk. The US remains one of Malaysia’s most important export markets for its electrical, electronics and semiconductor sectors. The ministry took over full control of issuing Non-Preferential Certificates of Origin for all US bound exports in May 2025, closing a loophole that had allowed goods from higher-tariff countries to be relabelled as Malaysian-made before export. The ministry has maintained that

o After Washington classified Malaysia as Tier 2 country, manufacturers potentially face same scrutiny as companies deliberately using nation as halfway house to evade tariffs, says expert

resolve any automated flags.” He was commenting on the White House identifying Malaysia among more than 40 countries allegedly used to circumvent high US tariffs on Chinese goods by routing exports through third countries. In its 24-page report, “The Great Transshipment Scam”, the White House placed Malaysia, Indonesia, Vietnam, Brazil, Thailand and Turkiye in Tier 2, describing them as having significant illicit transshipment volumes and deep ties to China-related supply chains, input sourcing and logistics systems. Legal and trade analysts have noted that the report is a policy document rather than a binding directive. It carries no legal force on its own and does not itself change Malaysia’s existing tariff obligations to the US.

“That could mean customs delays, additional paperwork and greater pressure on manufacturers to prove that their products are genuinely Malaysian rather than Chinese goods merely carrying a Malaysian label.” Muhammad Faliq pointed out the growing use of advanced technology by US Customs and Border Protection to trace the origins of goods and components. He said automated systems could flag Malaysian exporters simply for buying inputs from China – a common practice within Asean’s deeply interconnected manufacturing networks. “This underscores the necessity for our exporters to maintain impeccable, contemporaneous documentation of their manufacturing processes to quickly

Country needs to develop own technologies, says PM

Chang visiting an exhibition held in conjunction with the National Science Challenge 2026 in Shah Alam yesterday. – AMIRUL SYAFIQ/THE SUN

world problems. “Talent is everywhere. Our responsibility is to ensure that opportunities are also available everywhere.” Anwar said the government, schools, universities, industries and communities must work together to nurture young STEM talent and build a generation capable of advancing science and technology while ensuring that progress remains aligned with human values.

from an annual competition into a continuous talent development platform, particularly for promising students from rural areas, Sabah and Sarawak and low-income families. He said such students should be connected with mentors, laboratories, scholarships, universities, research institutions, industries and innovation networks to help transform their ideas into research, technologies, innovations and businesses that address real

He said the priority is not simply to encourage more students to choose STEM but to ensure that they stay the course, develop their capabilities and ultimately succeed in these fields. Anwar said science education must also move beyond memorising formulae and chasing examination results to nurturing critical thinking, curiosity, experimentation and the ability to learn from failure. He called for the NSC to evolve