KUCHING: The increase in tariffs by the United States of America (USA) on Malaysian goods is expected to have an impact on Sarawak’s trade performance, particularly small and medium enterprises (SMEs) involved in the downstream processing of commodities such as palm oil, timber and specialised manufacturing products.
Sarawak Patriots Association (SPA) chairman Datuk Dr Lau Pang Heng said that while the USA is not a major export market for Sarawak, disruptions in global supply chains, particularly involving intermediate goods such as palm oil-based products, could have an indirect impact on local producers and exporters, especially SMEs that supply companies exporting to the USA.
“Sectors such as palm-based cosmetics, wooden handicrafts, eco-friendly packaging, and rubber-based products may experience reduced demand or increased production costs.
“Entrepreneurs in these sectors face challenges in maintaining competitiveness if strategies are not adjusted.
“However, this also opens up opportunities for local businesses to innovate and explore new markets in the ASEAN region, China and the Middle East,” he said.
Regional trade agreements such as the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) can be leveraged for market diversification.
Lau also stressed the need to strengthen the entrepreneurial support system including trade advisory services, export financing, and research and development (R&D) incentives.
Stronger involvement in regional value chains can reduce dependence on a single market.
He added that state-level interventions are also important.
Initiatives such as digitalisation incentives, market access programmes, and investments in infrastructure and logistics need to be implemented to support SME growth, in line with the Sarawak Post COVID-19 Development Strategy 2030 which emphasises innovation, inclusivity and economic sustainability.
