Malaysia's exports will be more influenced by global economic growth and trade dynamics than by currency fluctuations, according to the country's trade minister on Tuesday, who also indicated a possible slowdown in outbound shipments.

Trade Minister Tengku Zafrul Aziz noted that exports saw a sharp increase in the first quarter of 2025 as companies rushed to fulfil orders ahead of US tariffs announced by President Donald Trump in early April.

“What will support the exports more is actually the growth of the global economy and the growth of global trade ... more so than the currency fluctuation,” Tengku Zafrul said during a press conference.

Malaysia's exports grew by a stronger-than-expected 6.8% in March compared to the previous year, with shipments to the United States reaching a record 22.66 billion Ringgit ($5.4 billion)

The trade minister explained that the “dramatic increase” in exports was driven largely by US buyers “looking at stocking up due to the possible increase in tariffs.” However, he cautioned that this export growth was unlikely to continue at the same pace in the future.

Malaysia's exports are expected to grow by 5.2% in 2025, slowing down from a 5.7% increase in 2024, Reuters reports.

The country faces a 24% tariff rate on exports to the US starting in July, unless an agreement is reached between the two nations. Malaysia has expressed its willingness to negotiate with the US on non-tariff barriers, reduce its bilateral trade surplus, and explore a potential bilateral trade agreement.

Prime Minister Anwar Ibrahim said on Monday that there is a possibility Malaysia could negotiate a reduction in the US tariffs, as Washington has agreed to continue discussions.

Furthermore, Tengku Zafrul went on to add that Malaysia's goal is to reduce the tariff to zero, noting that the US wants Malaysia to address trade imbalances, non-tariff barriers, and protect US technology from transhipment smuggling.

Malaysia's trade ministry will now be the exclusive issuer of certificates of origin for exports to the US to prevent illicit transshipment through the country, Tengku Zafrul announced, though he did not specify the countries from which these illegal shipments originated.

The ministry will also intensify audits of exporters' applications and strengthen investigations to combat any transhipment violations to the US.