IN response to the growing global economic uncertainty, the government is adopting strategic measures to mitigate the negative impacts on its foreign trade.
These steps include diversifying export destinations and enhancing diplomatic trade relations to safeguard the nation's economic resilience.
The Ministry of Investment, Trade, and Industry (MITI) outlined these efforts as part of the government’s broader strategy to ensure Malaysia’s economic stability amid rising geopolitical tensions and escalating trade wars projected to intensify in 2025.
MITI's response was shared in a written reply posted on the Malaysian Parliament's website on Tuesday.
MITI highlighted that Malaysia is actively diversifying its trade routes by exploring new markets in Central Asia, the Middle East, and Africa.
This initiative aims to reduce the nation's reliance on existing markets, thereby ensuring more robust and sustainable trade opportunities.
"The government is also expanding export market access through the signing of new Free Trade Agreements (FTAs), including the Malaysia-United Arab Emirates Comprehensive Economic Partnership Agreement (CEPA) that was signed in early 2025," MITI said in its statement.
Ongoing negotiations for additional FTAs include the Malaysia-European Free Trade Association (EFTA) agreement, the ASEAN-Canada FTA, and the Malaysia-Korea FTA.
Additionally, negotiations for a trade agreement between Malaysia and the European Union are set to resume this year.
"The government is also exploring the potential for FTAs with the Gulf Cooperation Council (GCC) and other countries," MITI added, responding to a question from Mohd Syahir Che Sulaiman (PN-Bachok) about Malaysia’s strategy to counter the negative effects of global economic volatility caused by trade wars and geopolitical tensions in 2025.
To maintain access to critical markets and ensure trade stability, MITI explained that Malaysia is strengthening its diplomatic relations through "soft diplomacy." This approach involves continuous engagement with key trading partners, such as the United States, to discuss shared trade interests.
"Continuous engagement sessions with the U.S. Department of Trade and the U.S. Trade Representative's office are being conducted to discuss mutual trade interests," MITI noted.
Furthermore, Malaysia’s participation in global and regional trade forums, such as the World Trade Organization (WTO), the Asia-Pacific Economic Cooperation (APEC), the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), opens additional trade opportunities and strengthens Malaysia’s position as a progressive trading nation internationally.
MITI also reaffirmed the government’s commitment to enhancing diplomatic trade ties and exploring new strategic economic opportunities to ensure that Malaysia remains competitive in the face of an increasingly complex global economic landscape.
"The government will continue to play an active role in strengthening trade diplomacy and exploring new strategic economic opportunities to ensure that Malaysia remains competitive amid the challenges posed by global economic uncertainty," MITI said. – February 26, 2025
