EU-Malaysia Economic and Trade Relations

26-09-2012

Malaysia's economy is one of the most open in the world. An export-oriented strategy helped the country to transform itself from a developing economy into a newly industrialised, middle income economy in only a few decades. Today Malaysia's goal is to become a high income country by 2020. Malaysia's economic base is varied, and trade is dominated by electronics and intermediate goods. However, the economy remains somewhat cushioned by the commodities sector, and its competitiveness relies largely on low cost labour. These dependencies must decrease if the country is to achieve its objective of becoming a high income country. Improving education and administration, creating modern and better jobs, and liberalising the service sector therefore figure high on the government's agenda. For the European Union, Malaysia is the second trading partner in the Association of Southeast Asian Nations (ASEAN), after Singapore. EU-Malaysian trade is focused on machinery and transport equipment, but opportunities are growing for the service sector. The two partners are currently negotiating a bilateral free trade agreement, although a region-to-region accord remains the ultimate goal for the EU.

Malaysia's economy is one of the most open in the world. An export-oriented strategy helped the country to transform itself from a developing economy into a newly industrialised, middle income economy in only a few decades. Today Malaysia's goal is to become a high income country by 2020. Malaysia's economic base is varied, and trade is dominated by electronics and intermediate goods. However, the economy remains somewhat cushioned by the commodities sector, and its competitiveness relies largely on low cost labour. These dependencies must decrease if the country is to achieve its objective of becoming a high income country. Improving education and administration, creating modern and better jobs, and liberalising the service sector therefore figure high on the government's agenda. For the European Union, Malaysia is the second trading partner in the Association of Southeast Asian Nations (ASEAN), after Singapore. EU-Malaysian trade is focused on machinery and transport equipment, but opportunities are growing for the service sector. The two partners are currently negotiating a bilateral free trade agreement, although a region-to-region accord remains the ultimate goal for the EU.