Any attempt by the incoming administration of US president-elect Donald Trump to impose tariffs on BRICS countries for trying to create a new currency or use alternatives to the US dollar could cause global semiconductor supply chain disruptions, Malaysia said yesterday.
The BRICS grouping of major emerging economies was initially Brazil, Russia, India and China, and has since expanded to take in other countries.
Malaysia has applied to be part of the bloc, but has not yet been officially accepted as a member. The Southeast Asian nation is a major semiconductor hub which accounts for about 13 percent of global chip testing and packaging.
Photo: REUTERS
Malaysian Minister of Investment, Trade and Industry Tengku Zafrul Aziz said the country is closely monitoring developments after Trump said BRICS members would face 100 percent tariffs unless they committed to not creating a new currency or supporting another currency that would replace the US dollar.
The US is Malaysia’s third-largest trade partner, and US firms are the main investors in its semiconductor sector, the minister said.
“As such, any move to impose a 100 percent tariff will only harm both parties which are depending on each other for efforts to prevent disruptions in the global supply chain,” he said in a parliamentary reply.
While BRICS countries have discussed reducing reliance on traditional trade currencies such as the US dollar, there has been no official decision made on de-dollarization efforts, he added.
On Monday, Russia said any US attempt to compel countries to use the greenback would backfire and only strengthen efforts among countries to switch to national currencies in trade.
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