KUALA LUMPUR: Malaysia is actively broadening trade strategies and sources of investments to avoid being affected by growing geopolitical tensions, the Dewan Rakyat was told today.
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said Malaysia is not experiencing significant short-term effects from the crises. But it should not underestimate the impact in the long term.
He said Malaysia is intensifying investment and trade promotion missions to existing partners such as Asean members, the United States, China, the European Union, Japan, South Korea and India.
"We are also enhancing economic cooperation with non-traditional trading partners like the United Arab Emirates, Saudi Arabia, Pakistan, Kazakhstan and Uzbekistan, Brazil, Peru and Mexico, as well as countries in Africa," he said in reply to Datuk Seri Hamzah Zainudin (PN-Larut).
Hamzah had asked about the steps taken by the government to ensure Malaysia's economy remains resilient to prolonged geopolitical tensions.
Tengku Zafrul said Russia and Ukraine, which are involved in a conflict, are not Malaysia's main trading partners.
Bilateral trade with both countries in 2023 accounted for only 0.25 per cent of Malaysia's total international trade.
He said bilateral trade with Middle Eastern countries, which are also in turmoil, is also low.
Tengku Zafrul said the government is also encouraging industries to increase the use of domestic resources and reduce dependency on imported raw materials.
"This includes prioritising supply from the Asean region through a 'nearshoring' approach.
"We are also implementing initiatives under the New Industrial Master Plan 2030. These include strategies to ensure the continuity of domestic supply chains in the face of economic or global health crises.
"Others measures include several new free-trade agreements, such as the Malaysia-United Arab Emirates Comprehensive Economic Partnership Agreement and the Asean-Canada Free Trade Agreement. We are upgrading the Asean Trade in Goods Agreement and the Asean-China Free Trade Agreement for a more stable and competitive Malaysian export sector.
"The implementation of these strategies has strengthened trade relations, attracted foreign investors and enhanced Malaysia's appeal as an international trade hub for the long term."