Malaysian Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz has raised the alarm over the escalating trade tensions between the United States and China, cautioning that continued tariff hikes under former President Donald Trump’s economic policy could send global iPhone prices soaring — potentially reaching the cost of a car.
In a series of recent statements across Facebook and Instagram, Tengku Zafrul explained the far-reaching implications of the US’s proposed 145% retaliatory tariffs, noting that the ripple effect would be felt far beyond American borders — including in Malaysia.
A Truly Global Product: The iPhone’s Fragile Supply Chain
Tengku Zafrul outlined how iPhones are quintessential products of globalisation. Their components are sourced from various countries: microchips from Taiwan, display screens from South Korea, batteries from China, modems and memory units from the US, storage from Japan, and cameras from a range of nations — with final assembly taking place in China.
Currently, the production cost of an iPhone is estimated at USD549.73 (approximately RM2,427). However, with a 145% tariff in place, the retail price could surge to around USD1,400 (RM6,174). If Apple were forced to move its entire manufacturing operation to the US — a scenario floated by some analysts amid protectionist trade policies — the cost could balloon to as much as USD3,500 (around RM16,000).
“The price of iPhones in other countries would rise too, not just in America,” said Tengku Zafrul. “This is because global iPhone prices typically follow the US benchmark.”
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Temporary Relief for Now — But For How Long?
Read: Trump Pauses Global Tariffs For 90 Days — But Escalates Trade War With 125% Levy On China
While the Biden administration had previously imposed steep tariffs on Chinese goods, recent reports indicate that smartphones, computer displays, and critical electronics components have been temporarily exempted. This move has brought short-term relief to global consumers and tech giants like Apple.
However, Tengku Zafrul warned the reprieve may be fleeting. “Our iPhone fans can breathe easy for now,” he said, “but no one knows how long this exemption will last. Trump could reverse it at any time.”
With Trump’s renewed push for aggressive tariff measures — recently rebranded as “Liberation Day” tariffs — there’s growing uncertainty over the future of international trade. Malaysia was initially hit with a 24% tariff rate, later reduced to 10% following a temporary 90-day pause on all nations except China.
Malaysia’s Vital Role in the Semiconductor Ecosystem
Beyond consumer electronics, Tengku Zafrul used the opportunity to highlight Malaysia’s strategic importance in the global supply chain — particularly in the semiconductor sector. He cited the COVID-19 pandemic as a stark reminder of the country’s relevance: when Malaysian chip supply lines were disrupted, American car manufacturer Ford was forced to halt production.
“A single missing chip, though tiny, can shut down an entire factory,” he said. “No country can operate in isolation. All are interdependent.”
Malaysia’s semiconductors are among its most valuable exports, making the nation especially vulnerable to trade disruptions triggered by protectionist policies abroad.
Tariffs Like Traffic Jams: Impact Felt From Factory to Consumer
Tengku Zafrul likened rising tariffs to traffic congestion: a blockage that slows down everything from production to consumption and investment. “Tariffs are not just technical policies — they create economic bottlenecks,” he explained.
International analysts have echoed his concerns. Several recent forecasts suggest that iPhone prices could climb by 30% to 43% globally if the tariffs remain in place. Apple would then face a difficult decision: absorb the added costs or pass them on to consumers.
For now, the temporary exemptions are keeping price hikes at bay. But the broader concern, according to Tengku Zafrul, lies in the sustainability of open trade itself. “Open trade isn’t just a slogan — it’s a necessity, particularly for export-driven economies like Malaysia.”
A Warning for the Future
Tengku Zafrul’s statements reflect growing anxiety among policymakers in Malaysia and elsewhere over the unpredictability of US trade strategy. With Trump’s possible return to the White House, many fear that the fragile balance of global commerce could be upended once more.
“The world economy is intricately connected,” said the minister. “Disruptions in one part of the chain impact us all. We must advocate for open, fair, and stable trade policies — not reactionary measures that punish producers and consumers alike.”
As the geopolitical chess game between superpowers continues, countries like Malaysia will be watching closely — and preparing for the economic aftershocks.
If these tariffs take full effect, paying the price of a car for an iPhone would border on absurd. Before the reality sets in, perhaps it’s time for Malaysians to reflect on their spending priorities — and consider whether brand loyalty is truly worth the premium.
What are your thoughts on this? Let us know in the comments.
*Sources: Visual and Reference Credits to Social Media & various cross-references for context.
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