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As a regional grouping, theEuropean Union (EU) remains Malaysia's largest source offoreign direct investment with a total investment inflow of $US13.6 billion (A$14.02 billion) last year, mainly inmanufacturing.
Negotiations for a Free Trade Agreement (FTA) between the EU and Malaysia were launched in 2010 and put on hold after seven rounds in 2012 at the request of Malaysia. A stocktaking exercise took place in 2016–17 to assess the prospect to resume negotiations. In the aftermath of the general elections in Malaysia in May 2018, the new government has yet to take a position on the possible resumption of negotiations.[1]
The revival of negotiations was actively supported during the 2020–2024 period, when efforts to re-engage on the Malaysia–EU FTA were publicly encouraged by EU representatives, including then EU Ambassador to Malaysia, Michalis Rokas. Optimism regarding the resumption of talks was expressed through various platforms, emphasising the agreement’s relevance to strengthening trade relations and supporting sustainable development goals.[2][3][4]
On Jan 20, 2025, during a working visit by Malaysian Prime MinisterAnwar Ibrahim to Brussels, Malaysia and EU announced the resumption of negotiation on the free trade agreements.[5][6]