SAMENTA Urges SMEs to Use Tariff Pause as a Launchpad for Long-Term Transformation

The Small and Medium Enterprises Association of Malaysia (SAMENTA) has acknowledged the recent announcement by US President Donald Trump of a 90-day pause on the newly introduced reciprocal tariffs for all economies except China, alongside a reduction in the proposed tariff rate to a flat 10 percent.

While this temporary reprieve offers Malaysian exporters some breathing space, SAMENTA National President, Datuk William Ng, cautions that businesses — particularly SMEs — must remain vigilant.

Ng stated that all stakeholders should remain calm and avoid panic or knee-jerk reactions, warning that such responses could be more damaging than the tariffs themselves. He noted that SMEs, already operating in a volatile global environment, are especially vulnerable to shifts in consumer confidence.

Given that SMEs contribute only 13 percent to Malaysia’s total exports, and that the majority operate within the services sector, they are highly susceptible to fluctuations in domestic spending.

Ng added that the US government’s latest move suggests that, while protectionist policies may persist, there is still space for negotiation. He urged Malaysian SMEs to use this window of opportunity to prepare not only for the possible reinstatement of tariffs but also to undertake a deeper reassessment of their supply chains, cost structures, and market diversification strategies.

He further emphasised the need for Malaysian businesses to move away from an over-dependence on any single market. According to Ng, this is an opportune moment to broaden customer bases within the region and forge new partnerships beyond traditional export destinations.

He stressed that the future lies in ‘Made by Malaysia’ — focusing on value creation through innovation, branding, and smart production, whether within Malaysia or in more cost-effective ASEAN locations.

SAMENTA also called on the government to intensify its support in the following key areas:

• Assisting SMEs to explore ASEAN and other high-potential markets;
• Reducing red tape and non-tariff barriers across the ASEAN region;
• Providing financing support and incentives for SMEs to recalibrate production and sourcing strategies;
• Encouraging greater research and development (R&D) as well as technology adoption among SMEs.

Ng reiterated that SMEs must not wait for external shocks to spur them into action. Instead, he urged them to invest now in resilience, build regional alliances, and identify new avenues for growth. He stressed that this temporary pause in tariff implementation should serve as a catalyst for long-term transformation.

SAMENTA remains committed to working closely with policymakers and strategic partners to support SMEs as they navigate an increasingly complex and evolving global trade environment.