A True Reciprocal Agreement or a Charter for Annexation?

 

The so-called reciprocal trade agreement, signed on Oct 26 has been presented as a pact to enhance reciprocity and secure supply chains. A review of the agreement’s main text and detailed annexes reveals a starkly different reality. (This blog is based on an article in MalaysiaNow dated 29 October 2025) 

Source: https://en.wikipedia.org

As mentioned in an earlier article in this blog, the deal's most consequential clauses are found in Section 5 under "Economic and National Security". Article 5.1.1 obliges Malaysia to become a direct participant in US economic conflicts. It states that if Washington imposes sanctions or tariffs on any third country for national security reasons, Malaysia "shall adopt or maintain a measure with equivalent restrictive effect". This provision effectively ends Malaysia’s long-held foreign policy of non-alignment, contractually obliging it to mirror US sanctions against other nations, regardless of Malaysia’s own interests. 

This alignment is deepened in Article 5.2, which requires Malaysia to “align with all unilateral export controls in force by the US” and actively cooperate in restricting its own nationals from transacting with entities on US domestic sanctions lists, such as the Department of Commerce’s Entity List and the Treasury's SDN List. 

The agreement’s annexes reveal the mechanisms for this enforcement.

Malaysia is required to “screen and share its customs and transaction data with US authorities, granting US agencies direct surveillance access to Malaysia's customs data to enforce US law on Malaysian soil. 

As the ultimate enforcement tool, Article 5.3.3 gives the US the unilateral right to “terminate this Agreement” if Malaysia enters into a new free trade agreement with a country that “jeopardises essential US interests”; in other words, the US may veto Malaysia's future trade diplomacy. 

The agreement mandates a massive, one-way transfer of wealth from Malaysia to the US. Article 6.1.3, reinforced by Annex IV, commits Malaysia to "facilitate... approximately US$70 billion in job-creating investment... in the United States" over the next 10 years Annex IV also details an "estimated value of US$150 billion" in purchases by Malaysian multinational companies for semiconductors, aerospace, and data centre equipment over the next five years. This combined US$220 billion commitment functions as a direct, non-reciprocal stimulus package for the US economy, draining capital from Malaysia’s domestic development. 

Article 6.2 of Annex III explicitly forbids Malaysia from "banning critical mineral exports to the United States" and forces it to "eliminate any rare earth element export quotas to the United States". It further commits Malaysia to encouraging a supply of rare earth magnets on "terms favourable to the United States". The agreement explicitly bans the policy tools used by developing nations to build local capacity, including restrictions on technology transfer and digital taxes. Article 3.1 of the main text bans "discriminatory" digital services taxes, while Article 3.1 of Annex III specifically forces Malaysia to “remove the requirement for US social media platforms and cloud providers to contribute 6% of their revenue... to a domestic fund”. 

Malaysia’s domestic regulatory bodies are rendered irrelevant and are legally bound to accept US standards as their own. Medicine: Article 2.4 of Annex III states that Malaysia "shall accept a prior marketing authorisation issued by the FDA" for US pharmaceuticals as sufficient for approval in Malaysia, and must accept FDA factory inspections "without further need for an inspection" by Malaysian authorities. Food Safety: Article 2.6 of Annex III requires Malaysia to "recognise that the US sanitary and phytosanitary (SPS) measures... satisfy the requirements of Malaysia’s measures". Furthermore, Article 2.13 states that if Malaysia has no set limit for a pesticide, it “shall recognise and accept the corresponding US tolerances”. 

The deal directly targets everything from agriculture to media. Consider Article 2.20 of Annex III. It requires Malaysia to "remove the requirement... that broadcast stations devote 80% of terrestrial airtime to local Malaysian programming". 

Meanwhile, Annex I, Appendix 1, establishes large, duty-free quotas for sensitive agricultural goods, including 500,000 kg of swine meat, two million litres of milk, and one million eggs in the first year alone – all set to increase annually – exposing local farmers to devastating, state-sponsored competition. While Malaysia surrenders its sovereignty, economy, and regulatory power, the US, in Article 7.4, explicitly retains its unilateral right to impose additional tariffs on Malaysia to "protect its economic or national security". 

This is not a bilateral agreement. It is a one-sided charter that secures Malaysia’s role as a dependent economic and military asset for Washington. Why did we do this? To pacify the US? To sign an agreement irrespective of its content and consequence? Are we a vassal state of the US? Why don’t we surrender monetary policy and use the US dollar as our currency? 

Reference:

A charter for annexation: How Anwar delivers Malaysia on a platter to Uncle Sam,

MalaysiaNow, 29 October 2025