The European Free Trade Association and Malaysia begin Fourth Round of Trade Negotiations

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In April, the European Free Trade Association (EFTA) held its fourth round of trade negotiations with Malaysia in Kuala Lumpur. The EFTA is made up of four countries: Iceland, Liechtenstein, Norway, and Switzerland.

Discussions on the free trade agreement (FTA) were originally launched in November 2012 and the first round of negotiations was held in March 2014. The EFTA and Malaysia also signed a Joint Declaration in July 2010.

During the current round of negotiations, areas of discussion included the following: goods, services, investment, rules of origin, trade facilitation, technical barriers to trade, sanitary and phytosanitary measures, trade remedies, intellectual property rights, trade and sustainable development, competition, government procurement regimes, legal and institutional issues, and cooperation.

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The two sides also agreed upon action items and goals for the next round of negotiations, scheduled to be held in October of this year.

The EFTA and Malaysia are keen to boost their burgeoning trade partnership. In 2013, bilateral trade was worth almost US$2 billion – a 6.5 percent increase over the previous year. Trade has steadily increased between the EFTA and Malaysia since 2003, with only a brief downturn during the global financial crisis. Switzerland is Malaysia’s largest trading partner in the EFTA.

The top five EFTA imports from Malaysia are:

  • Electrical machinery
  • Machinery, mechanical appliances
  • Optical, medical, surgical instruments
  • Rubber, rubber articles
  • Plastic, plastic articles

The top five EFTA exports to Malaysia are:

  • Machinery, mechanical appliances
  • Pharmaceutical products
  • Electrical machinery
  • Clocks and watches
  • Optical, medical, surgical instruments

The EFTA also recently held its first round of trade negotiations with the Philippines. The FTA will cover similar areas as the one with Malaysia, and EFTA countries are especially interested in importing Philippine agricultural produce as well as other finished products, such as furniture.

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A full list of Malaysia’s trade agreements can be found here. The country’s membership in the ASEAN organization also places it in a prime trade position vis-à-vis a number of countries and regions, to see a full list of ASEAN related trade agreements, please see here. It is highly suggested that investors consult a professional services firm so that they can take full advantage of any FTAs or other beneficial agreements that the country they are operating in has signed.


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