Malaysian firms pivot to domestic markets in response to rising tariffs
Survey finds more than four in 10 Malaysian businesses have turned their attention to domestic market
KUALA LUMPUR, Malaysia (MNTV) — More than four in 10 Malaysian businesses have turned their attention to the domestic market in response to rising tariffs and volatile trade policies, according to the latest HSBC Global Trade Pulse Survey 2025.
The survey, which polled 250 Malaysian companies, reveals a shifting trade strategy as Malaysian enterprises grapple with surging costs and persistent supply chain disruptions, reports The Malaysian Reserve.
To mitigate these pressures, 42% of companies have already pivoted toward serving local customers, with another 40% planning a similar shift.
Simultaneously, 37% have boosted inventory levels to manage disruptions, while nearly half (49%) intend to follow suit.
Yet, optimism endures. An overwhelming 91% of Malaysian firms expressed confidence in growing international trade — surpassing the global average of 89%.
Encouragingly, 73% said trade uncertainties have driven their businesses to evolve and explore new opportunities.
“Despite the challenges posed by the uncertain tariff and trade landscape, businesses in Malaysia are demonstrating resilience and adaptability in the way they operate,” said HSBC Malaysia CEO and head of banking Datuk Omar Siddiq.
“While supply chains may be further reconfigured, there continues to be strong potential for local companies to leverage on Malaysia’s strong trade ties particularly in Asia.”
Malaysian companies are deepening trade relationships within Asia, with 61% aiming to increase business with China, South Asia (55%) and North Asia (44%).
The report also highlights an emerging appetite for innovation and operational restructuring.
About 64% of Malaysian companies have adopted new technology or digital platforms, while 48% have rolled out new products and services.
Growth initiatives are increasingly centered around regional expansion (57%) and cost optimization (54%).
In terms of support, Malaysian businesses cite cash and liquidity management (64%), improved payment terms (56%) and supply chain financing (55%) as the most helpful tools to weather the current disruptions.
“With over 70% of Malaysian businesses anticipating sustained cost increases from the impact of tariffs and trade uncertainty on the cost of doing business and businesses facing an average 18% drop in revenue, the imperative for strategic adaptation is clear,” Omar said.
The HSBC Global Trade Pulse survey was conducted from April 30 to May 12.
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