KUALA LUMPUR (April 11):  Malaysia has secured a zero-import duties arrangement with the European Free Trade Association (EFTA) — Iceland, Liechtenstein, Norway and Switzerland — paving the way for the signing of the free trade agreement in June 2025, said the Ministry of Investment, Trade and Industry (Miti).

Miti Minister Tengku Datuk Seri Zafrul Abdul Aziz welcomed the clarity and stability the Malaysia-European Free Trade Association Economic Partnership Agreement (MEEPA) offers, especially amid ongoing uncertainty over US tariffs.

The US has imposed a 24% reciprocal tariff on Malaysia. It kicked off on April 9, but has since been paused for 90 days.

“Such certainty will certainly support local exporters, while strengthening Malaysia’s long-term economic engagement with the EFTA countries. We look forward to increasing trade with these countries, particularly in high-value goods and services,” Zafrul added.

The government concluded MEEPA talks on Friday, covering key areas like trade in goods and services, investment, intellectual property, competition, government procurement, cooperation, sustainable development and customs processes.

MEEPA will replace Malaysia’s current trade arrangement under the EFTA’s Generalised System of Preferences, which provides temporary tariff preferences and is subject to withdrawal once Malaysia graduates from the scheme.

“With MEEPA, this uncertainty is removed as Malaysia has achieved a permanent elimination of import duties in EFTA markets,” said Miti in a statement on Friday.

Malaysia’s bilateral trade with EFTA states reached RM14.4 billion in 2024. Malaysia’s main exports to EFTA include electrical and electronic (E&E) products, machinery, scientific instruments, chemicals and rubber. Imports from the EFTA include chemicals, machinery, scientific instruments, E&E products and metals.

The agreement is also open for potential partnerships and knowledge transfers between Malaysia and EFTA states.

The EFTA is well-known for its research and development (R&D) expertise and innovation in key areas such as renewable energy, science, technology and high precision industries.

Miti said MEEPA allows Malaysia to benefit from the EFTA’s strengths through cooperation and capacity-building projects under memoranda of understanding, offering strong growth and development opportunities.