AAT Business Club

Malaysia’s total trade with OIC countries up 24.6% this year

 

MALAYSIA’S total trade with the Organisation of Islamic Cooperation (OIC) countries has slightly recovered with double digits growth at 24.6% to US$20.81 billion (RM88.1 billion) for the period of January to May 2021 from US$16.66 billion in the same period last year.

Exports registered US$10.49 billion between January and May this year, a 26.1% increase from US$8.32 billion in the same period in 2020 while imports rose 23.6% to US$10.32 billion from US$8.34 billion.

“This is a good sign of recovery in tandem with the global recovery,” the Malaysia External Trade Development Corp exports promotion and market access division senior director Abu Bakar Koyakutty said at the e-press conference of the Malaysia Showcase Hybrid yesterday.

In terms of trade, Malaysia’s top five key markets in OIC are Indonesia, Saudi Arabia, United Arab Emirates, Turkey and Bangladesh.

Malaysia is currently setting its sights to explore the halal corridors with Turkey to enhance bilateral market access.

The recent signing of the joint declaration on the expansion of the Malaysia-Turkey Free Trade Agreement (MTFTA) signals the commitment between the two nations to boost post-pandemic recovery and economic growth.

Apart from that, the participation of Malaysia’s Halal Showcase at the 8th OIC Halal Expo 2021 in Istanbul is also a step to build and foster a relationship among businesses from both countries.

Abu Bakar said Malaysia’s bilateral trade with Turkey has steadily improved in recent years with total trade expanding from US$2.11 billion in 2019 to US$2.30 billion last year.

From the period of January to May 2021, total trade climbed 79.4% to US$1.63 billion from US$440 million previously.

He said among the products with growing buying interest from the Turkish market are palm oil, oleo chemicals (derivatives of palm oil), rubber gloves, cocoa based products and food ingredients.

The MTFTA was signed on Apr 17, 2014, in Ankara and came into effect on Aug 1, 2015.

Both Malaysia and Turkey have eliminated and bound duties on 70% of the tariff lines upon entry into force of the MTFTA.

Malaysian exports continued to gain preferential market access and remain competitive in the Turkish market.

The MTFTA will be realised over a period of eight years. After eight years, duties will be further reduced or eliminated on almost 86% of tariff lines.

“A total of 13,515 FTAs from Malaysian exporters were approved last year. I think exporters from both countries should fully leverage this because this is the way forward.

“I think they (Turkish companies) are currently reviewing some of the FTAs to make it more comprehensive to cover some of the sectors that have not been covered,” said Abu Bakar.

The Turkish Independent Industrialists and Businessmen’s Association deputy president Mustafa Ayedemir said it is a great opportunity for Malaysia and Turkey to form partnerships to look for a way out of the Covid-19 pandemic that has been affecting businesses worldwide.

“There are a lot of small and medium businesses in Turkey that are looking for partners in Malaysia to gain some market share in Asean and they are offering offices, network and customer base to do business.

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