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Malaysia feels ripple effects of Middle East conflict on economy

Source: Xinhua

Editor: huaxia

2026-05-25 21:35:45

KUALA LUMPUR, May 25 (Xinhua) -- Malaysia is feeling the economic ripple effects of the Middle East conflict, with higher energy prices, rising logistics costs and supply chain disruptions affecting several sectors, Economy Minister Akmal Nasrullah Mohd Nasir said Monday.

According to Akmal, 7,057 workers lost their jobs in April, up 21 percent from March, while the logistics and aviation sectors have also seen growing pressure.

Agricultural commodity producers are also facing mounting pressure, with shipping costs to the Middle East surging between 50 percent and 80 percent, while fertilizer prices rose as much as 45.5 percent, and agricultural pesticides up to 37.5 percent.

Plantation and machinery operating costs have increased 10 percent to 30 percent, rubber replanting costs have risen 46 percent to 55 percent, and palm oleochemical production costs have increased up to 30 percent.

First-quarter agricultural trading volume also declined 14.7 percent due to weaker exports across cocoa, rubber, palm oil, pepper and timber products.

Akmal foresees overall agricultural exports to decline 13.48 percent in 2026, while imports are expected to fall 3.28 percent.