Malaysia’s Q1 GDP Grows 4.4%, U.S. Exports Surge Amid Tariff Concerns

Malaysia’s economy expanded by 4.4% year-on-year in Q1 2025, according to official advance estimates released Friday. While slower than the 5% growth recorded in Q4 2024, the economy remained resilient amid global headwinds, supported by strong domestic demand and retail activity.

Chief Statistician Mohd Uzir Mahidin noted that solid performance in the retail and wholesale trade sectors, a stable labor market, and increased demand for key exports were crucial in sustaining growth. Final Q1 GDP figures will be released on May 16.

March trade data showed a 6.8% year-on-year increase in exports, outperforming expectations. Notably, shipments to the United States surged by 50.8% to a record 22.66 billion ringgit ($5.14 billion), highlighting strong trade ties despite looming tariff risks.

Earlier this month, U.S. President Donald Trump announced a new round of global import tariffs, many of which are delayed until July. Malaysia, facing a 24% tariff on select goods, plans to send a delegation next week for discussions with U.S. officials to address the issue.

Despite these developments, Malaysia’s central bank has kept its 2025 GDP growth forecast at 4.5% to 5.5%, with export growth expected at 5.2%. The Ministry of Trade emphasized that while recent data is encouraging, global trade uncertainties could impact future investment and domestic demand.

“As a small, open trading nation, Malaysia remains vulnerable to external shocks and volatility in the global trade environment,” the ministry stated.

The robust export figures, especially to the U.S., offer a positive sign for Malaysia’s trade outlook, but policymakers remain vigilant as geopolitical and economic tensions rise.