KUALA LUMPUR: Malaysia will provide clarification to the United States over allegations of excess industrial capacity and the use of forced labour, issues that have prompted a US investigation under Section 301 of its Trade Act.
Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said claims of excess manufacturing capacity did not necessarily mean Malaysia was dumping products in the US market.
“We can ask them to check. Even if we have excess capacity, if we are not dumping products, we can show our costs.
“The cost of producing goods locally is the same as the cost for exports. If the price we charge in Malaysia matches our export price, then it cannot be considered dumping,” he said.
He was speaking to reporters after attending a dialogue session organised by the Persatuan Peniaga Bundle Malaysia in collaboration with the Majlis Belia Kawasan Titiwangsa here yesterday.
Johari said that dumping typically occurred when a product is sold at a lower price in the export market than in its country of origin.
“For example, if the price in Malaysia is RM100 and we sell it in another country for RM80 or RM90, that could create the perception that we are trying to undercut competitors in their market,” he said.
Addressing allegations of forced labour, he said Malaysia had labour laws in place to safeguard workers and prevent exploitation, including strict prohibitions against employing underage workers.
“As for forced labour, the use of undocumented workers is prohibited. Even with valid permits, employers cannot pay below the minimum wage set by the government.
“The employment of underage workers is also strictly forbidden. These practices are regulated by law,” he said.
The administration of US President Donald Trump recently announced two new trade investigations into excess industrial capacity among 16 major trading partners and into forced labour, as part of efforts to reapply tariff pressure after the US Supreme Court struck down much of Trump’s tariff programme last month.
US Trade Representative Jamieson Greer said the Section 301 investigation into unfair trade practices could lead to new tariffs on countries including China, the European Union, India, Japan, South Korea and Mexico as early as this summer.
Other trading partners under scrutiny for excess industrial capacity include Taiwan, Vietnam, Thailand, Malaysia, Cambodia, Singapore, Indonesia, Bangladesh, Switzerland and Norway. Canada, the second-largest US trading partner, was not listed as a target of the probe.
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