Latest news with #StrategicTradeAct2010
The Star
2 hours ago
- Business
- The Star
No proof of AI chip smuggling, says Zafrul
KUALA LUMPUR: The Ministry of Investment, Trade and Industry (Miti) has not found any evidence of incidents relating to the smuggling of high-performance artificial intelligence (AI) chips, said its minister Tengku Datuk Seri Zafrul Abdul Aziz. He stated that the ministry has been working closely with authorities, including the police, the Customs Department, and the Malaysian Communications and Multimedia Commission (MCMC), as well as industry players, to investigate the matter. 'So far, we have not found any (evidence). We have spoken to the United States and big players to cooperate and work with us. If there is any evidence, we will take action. The investigation continues,' he told a press conference on Miti's report card for the second quarter of 2025. According to Tengku Zafrul, the demand for AI chips in Malaysia has been high due to its growing data centre industry. 'I think that has raised some red flags because Malaysia has started to be a dominant player in the industry,' he said, Bernama reported. On Monday, Miti issued a new directive imposing immediate controls on the export, transshipment and transit of high-performance AI chips of US origin within Malaysia under Section 12 of the Strategic Trade Act 2010. Tengku Zafrul emphasised that the government is dedicated to fostering a transparent and lawful trading environment for all partners and investors. 'We aim to ensure responsible trade practices, and we are currently reviewing the inclusion of AI chips in the Strategic Item List (SIL). 'We also want to make sure that we comply with international standards and obligations, he said, adding that it is to avoid secondary sanctions for the sake of the nation's industry and economy,' he said.
The Star
8 hours ago
- Business
- The Star
Trade performance on track to hit growth target
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz. — Reuters KUALA LUMPUR: Malaysia's trade performance for this year remains within expectations and is on track to reach the target growth of 4% to 5%, says Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz. Nevertheless, Tengku Zafrul said the Investment, Trade and Industry Ministry (Miti) expects global trade to moderate in the second half of 2025 (2H25) amid ongoing uncertainties. 'Yes, there is some front-loading, especially in the last five months, but at the same time, given the Aug 1 deadline (for US tariffs), we expect the (moderation) to continue. 'We are going to issue the latest trade numbers for June on Friday, and what is important is that Malaysia's trade performance is still within expectations,' he told a press conference on Miti's report card for the second quarter of this year. Tengku Zafrul noted that the projection by Bank Negara for trade growth is around 5% this year, while the Finance Ministry has projected about 3.9%. 'We will continue to focus on achieving (those) targets,' he said. Earlier during the report card presentation, Tengku Zafrul highlighted that the country has been gathering a total of RM25.6bil in potential investments and RM30.8bil in potential exports from the trade and investment missions held to date. Malaysia has also recently inked new free trade agreements with the European Free Trade Association (EFTA) in June, which is expected to reach a total of RM14.4bil in trade with the EFTA market. Meanwhile, on the tariff negotiation with the United States, Tengku Zafrul said his ministry is now looking at tariff and non-tariff related matters that can be agreed upon by both parties. 'I have set a deadline for the negotiation team, and there are issues that we still need time for because they involve many agencies and ministries. 'We are trying to conclude it before US President Donald Trump's tariff deadline on Aug 1. We are doing the calculations as well on what the impact is to our export and the impact to the government's revenue as well. 'We will continue to have another discussion this week and accelerate the discussion until the end of this month,' he added. Tengku Zafrul noted that some concerns on non-tariff issues have been addressed by Miti through the implementation of the Strategic Trade Act 2010, while 'red line' issues, such as those related to the equity interest in certain sectors, need to be studied carefully. 'As you know, Malaysia has equity restrictions for foreign shareholders for certain sectors, so there is a request for us to relook at or liberalise those sectors. Many countries have also been asked to do the same. 'For us, we need to consult the industries whether we are ready to liberalise those equity shareholding restrictions, especially when it comes to foreign equity restrictions that we have for many sectors. 'So we need to study carefully what the impact is,' he said. — Bernama
The Star
15 hours ago
- Business
- The Star
Miti requires permit for US-made AI chip exports
KUALA LUMPUR: The Investment, Trade and Industry Ministry (Miti) has imposed an immediate requirement for a Strategic Trade Permit on all exports, transshipments and transits of high-performance artificial intelligence (AI) chips of US origin, as part of efforts to close regulatory gaps. Miti said the new measure falls under Section 12 of the Strategic Trade Act 2010 (STA 2010), known as the Catch-All Control provision. It mandates individuals or firm to notify the authorities at least 30 days in advance if they intend to export, transship, or transit any item not listed in the Strategic Items List (SIL), where there is knowledge or reasonable suspicion that the item may be misused or involved in restricted activities. 'This initiative serves to close regulatory gaps while Malaysia undertakes further review on the inclusion of high-performance AI chips of US origin into the SIL of the STA 2010,' Miti said in a statement yesterday. Miti said Malaysia takes a firm stance against any attempt to circumvent export controls or engage in illicit trade. Any individual or company found violating the STA 2010 or related laws will face strict legal action. 'While Malaysia supports investments and trade that align with international best practices and multilaterally agreed commitments, all entities operating in the country are expected to comply with applicable international obligations to avoid secondary sanctions on their businesses,' it said. Miti reaffirmed its commitment to maintaining a safe, secure, transparent and rules-based trading environment, and said it will not tolerate misuse of Malaysia's jurisdiction for illicit trade activities. Commenting on the development, SPI Asset Management managing director Stephen Innes said the new export control does not directly hinder Malaysia's ongoing AI and data centre expansion efforts, which are driven by infrastructure investment, cloud partnerships and local talent. However, it does signal tighter regulatory oversight. 'If you want to play in the AI sandbox, you now need to watch your sourcing, disclosure and compliance trail more carefully,' he told Bernama. Innes said while multinational technology firms are likely to view this as a manageable hurdle, smaller local players or startups could face some challenges without the benefit of robust legal support. On the chip industry itself, he said Malaysia's core strength in testing and packaging means it may be spared the brunt of disruptions. 'This law forces the industry to mature quickly in terms of compliance infrastructure. The upside is that it may accelerate Malaysia's push toward more transparent, globally integrated standards,' he added. Meanwhile, economist Professor Geoffrey Williams said the changes in regulations showed a more cooperative approach from the tariff talks, which is a good sign. Williams said this indicated that both sides are listening to each other and responding quickly. 'This will deliver a much better chance of lowering the 25% reciprocal tariffs and is better than taking a belligerent stance. It is a closer win-win engagement,' he said. Williams said the United States has been concerned that AI chips are being sent to China through third countries in Asean, in breach of the US embargo. 'Therefore, getting better coordinated regulation across Asean is a positive response to address US concerns, and Malaysia is playing a key role in this,' he said, adding that this would have no significant effect on data centre and AI operations in Malaysia, except to restrict illicit activities.
The Sun
15 hours ago
- Business
- The Sun
MSIA: Miti move shows Malaysia's seriousness in complying with international trade obligations
KUALA LUMPUR: The trade permit imposed for US origin high-performance artificial intelligence (AI) chips reaffirms Malaysia's commitment as a trusted hub for managing advanced technology exports, transshipments, and transits. In stating this, Malaysia Semiconductor Industry Association (MSIA) president Datuk Seri Wong Siew Hai said the measure sent a strong signal of Malaysia's seriousness in complying with international trade obligations, including the US export controls. 'The trade permit makes it clear that the government will not tolerate any abuse of exports, transshipment, or illicit trading,' Wong told Bernama when asked to comment on the current measures announced by the Ministry of Investment, Trade and Industry (Miti) on Monday. He added that many Malaysian firms have already taken proactive steps, including internal audits, to ensure they adhere to local and global regulations. 'We in Malaysia, both the private sector and government, take this very seriously. We want to make sure everything is fully compliant.' However, Wong said there is a need for greater clarity from the government on specific reporting obligations under the strategic trade permit. 'We need to know what needs to be reported and what constitutes notification to authorities. Once this is clear, companies can incorporate any additional steps needed to meet compliance,' he said. Miti on Monday announced that, effective immediately, all exports, transshipments, and transits of US-origin high-performance AI chips would be subject to a Strategic Trade Permit under Section 12 of the Strategic Trade Act 2010 (STA 2010), also known as the Catch-All Control provision. Under the provision, individuals or companies are required to notify authorities at least 30 days in advance if they intend to export, transship, or transit any unlisted item that may be suspected of being misused or involved in restricted activities. Meanwhile, Pacific Research Center of Malaysia principal adviser Oh Ei Sun said the move would not affect local data centre or AI development projects, as it pertains primarily to the transshipment or export of US-made chips, not their import into Malaysia for domestic use. 'I would not say Malaysia's industry lacked transparency before this. But the US is now taking this issue very seriously, and we are acting accordingly because we value our overall relationship with the US,' he said.
The Sun
a day ago
- Business
- The Sun
MITI finds no proof of AI chips smuggling in Malaysia
KUALA LUMPUR: The Ministry of Investment, Trade and Industry (MITI) has found no proof of high-performance artificial intelligence (AI) chips being smuggled into Malaysia, according to its minister, Tengku Datuk Seri Zafrul Tengku Abdul Aziz. He stated that MITI has been coordinating with enforcement agencies, including the police, Customs Department, and the Malaysian Communications and Multimedia Commission (MCMC), alongside industry stakeholders to verify the claims. 'So far, we have not found any (evidence). We have spoken to the United States (US) and big players to cooperate and work with us. If there is any evidence, we will definitely take action. The investigation continues,' he said during a press conference on MITI's second-quarter 2025 performance report. Tengku Zafrul noted that Malaysia's expanding data centre industry has driven significant demand for AI chips, raising concerns among international observers. 'I think that has raised some red flags because Malaysia has started to be a dominant player in the industry,' he added. Earlier this week, MITI introduced immediate export, transhipment, and transit controls for US-origin high-performance AI chips under the Strategic Trade Act 2010. The minister reiterated the government's commitment to maintaining a transparent and lawful trade environment. 'We want to ensure there is a responsible trade, and we are currently reviewing the listing of AI chips under the Strategic Item List (SIL). We also want to make sure that we are in compliance with international standards and obligations,' he said, stressing the need to prevent secondary sanctions affecting Malaysia's economy. - Bernama
