According to 90% of the more than 200 companies that took part in a Federation of Malaysian Manufacturers – FMM survey in Malaysia, the West Asia conflict will cause problems in the supply chain within the next two weeks, the week starting April 20, 2026.
President Jacob Lee Chor Kok said that some important materials needed for manufacturing are likely to be hard to find or not available at all, in addition to prices going up.
He said that the conflict in West Asia has hurt the sector in three main ways – it has caused problems with logistics, made energy and fuel more expensive, and wrecked the supply of materials.
The FMM survey in Malaysia is indeed an eye opener. The companies having to pay more for insurance and port storage when shipments are delayed, and they also have to pay more to reroute shipments.
The rise in energy and fuel prices is another problem that affects everyone. Because of this, FMM is asking the government to think about giving the sector a diesel subsidy.
There are big problems, especially with petrochemical derivative products like polyvinyl chloride, polypropylene, polyethylene, and various other plastic resins, Jacob Lee Chor Kok said during the Bernama TV program – Impact of the West Asia Conflict on Malaysia’s Manufacturing Sector on April 06, 2026.
He said that most Malaysian businesses are in traditional manufacturing, which means they are very sensitive to price increases because their margins are so small. This is indeed a big threat to the long-term health of businesses.
He added, “We do hope that the government could come up with measures or interventions to help cushion cost increases so that companies will not need to pass on too much of the increase to consumers, which could in turn drive inflation.”
Lee says that the Malaysian manufacturing sector makes a big difference in the country’s gross domestic product – GDP with a 23% of GDP, and employs 2.3 million people.
According to Lee, “We (the manufacturing sector) are probably the second-largest taxpayer in the country. Meanwhile, 86% of Malaysia’s exports are manufactured goods. However, I would also like to highlight that 44% of our exports come from the electrical and electronics sector or emerging technology manufacturing.”
Lee also said that the Purchasing Managers’ Index – PMI, which shows whether the manufacturing sector is getting bigger or smaller, showed that the sector was getting better but was still unstable. The PMI rose to 50.2 in January 2026 and then fell to 49.3 in February. — Bernama
He said that PMI is an indicator with an upper limit of 50. Readings above 50 show growth, while readings below 50 show contraction.
Right now, the price of oil is still over $100 a barrel. At 5:18 PM on April 7, 2026, Brent crude oil dropped 1.54% to $107.30 per barrel. – Bernama
