In a bid to uplift Canadian – Malaysian trade and bilateral ties, a 270-delegate strong Team Canada Trade Mission (TCTM) held a mutual beneficial event in Malaysia today (Mar 25) to increase mutual trade and investment opportunities for both nations.
As part of Canada’s economic trade priorities in the Indo-Pacific region, the TCTM created a platform to up Malaysia’s game on both trade and investment.
“We invite Canadian businesses to consider Malaysia as your main trading and investment partner in this region. There are numerous compelling reasons for this, but for the sake of brevity, let me share three with you. Firstly, our clear policies on not just industrial development but also industrial reforms – all these will drive Malaysia’s future expo Minister of Investment, Trade And Industry Tengku Zafrul Abdul Aziz, in the keynote address at the event launch on Kuala Lumpur today.
Zafrul said in 2023, Malaysia’s global trade reached USD578.07 billion, a 7.3% decrease compared to 2022. Similarly, Malaysia’s trade with Canada last year also declined. This was consistent with sluggish global demand, lower commodity prices, geopolitical uncertainties, high inflation rate and a downcycle in the semiconductor sector.
“However, since 2018, we have seen a 25% increase in bilateral trade with Canada, particularly since the CPTPP came into force, which represents a healthier trend moving forward. Malaysia has been exporting mainly E&E products, rubber products and manufactures of metal to Canada, while we import products such as chemicals and chemical products, cereals and E&E products from Canada.
He added, in 2024, projections look brighter with WTO’s forecast of 3.3% in merchandise trade growth for 2024. In terms of investments, Malaysia is proud to host Canadian companies like Celestica, Sun Life and other companies which have been thriving here for more than a decade.
As of today, a total of 96 manufacturing projects with Canadian participation have been implemented, with total investments worth USD274 million.
The top three sectors for Canadian investments are E&E, basic metal products, and wood and wood products and the various projects have generated employment for 11,027 people.
He explained that the TCTM today is a platform to up our game on both trade and investment. We invite Canadian businesses to consider Malaysia as your main trading and investment partner in this region.
In addition, Zafrul said via Malaysia’s Push for Net Zero and the sustainability agenda, the NIMP2030 also targets for high growth sectors such as electric vehicles (EVs), renewable energy (RE), Carbon Capture, Utilisation and Storage (CCUS), green manufacturing and circular economy, which I understand are very much aligned with the TCTM’s objectives.
“On getting our industries – particularly our SMEs – to embrace ESG principles, we launched the National Environmental, Social and Governance Industry Framework (or i-ESG) for the manufacturing sector in September last year. The i-ESG Framework serves as a guide for businesses, particularly SMEs, to incorporate ESG considerations into their operations, and is integral to our industrial masterplan’s NIMP2030 mission of economic inclusivity.
“It will help them manage risks and build resilience, while also ensuring their continued access to ESG-sensitive markets. On that score, our existing and potential Canadian partners are very much welcome to offer their expertise to help build the ESG capacity of our SMEs.
Both nations can also conside ris that when doing business with Malaysia is not just our disciplined execution, but also our respect for the rule of law. On execution, manufacturing projects here will generally take 18 – 24 months from approval to getting off the ground, depending on the level of complexity. In the past year alone, due to Malaysia’s disciplined execution, there were quite a few projects that were successfully implemented in a shorter period of less than 18 months, some within 12 months.
Among the projects involved were:
a. Enovix, which will develop the first high-volume manufacturing facility of silicon batteries in Malaysia;
b. Ferrotec Manufacturing, which just established their first manufacturing facility in Southeast Asia, producing electromechanical equipment and advanced materials for the semiconductor industry; anf
c. Ultra Clean Technology which expanded their capacity to produce equipment, modules and components for the semiconductor industry.
Zafrul also told the delegates on aspects of the Malaysian semiconductor whereby Malaysia contributes 7% to global semiconductor trade and 13% to the global semiconductor testing and packaging sector.
He explained that Malaysia’s industrial masterplan has outlined a clear pathway towards moving up the value chain for this sector, which has been established in Malaysia for over 50 years. It has enabled the growth of many other sectors that depend on chips and semiconductors, such as Electric Vehicles, life sciences and medical equipment, aerospace and even renewable energy technology, which you can consider.
Other interesting sectors include halal food and ingredients, clean technology; defence, IR4.0 technology, he added
FTAs As Catalysts In Strengthening Malaysia – Canada Bilateral Trade And Economic Ties
Exporters are able to leverage on the Free Trade Agreements that both our countries have signed, including the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP) and strong industrial policies, industrial reforms under NIMP 2030.
To this end, Malaysia has increased focus on courting investments in specific high-tech and high-value industries, and those that will help our established industries move up the global value chain, Zafrul said, calling on Canadian investors to collaborate with Malaysian counterparts in sectors such as semiconductor (IC design and wafer fabrication); specialty chemicals; advanced materials, aerospace; pharmaceuticals; and medical devices.
TCTM was led by Canadian Minister of Export Promotion, International Trade and Economic Development Mary Ng from March 24 to 26.
Speaking at the launch of the event today, Ng said as part of their Indo-Pacific Strategy the team was here to expand and share innovation and expertise to an 67 year-old trading partner in the region, namely Malaysia.
“The goal is to create opportunities. Opportunities for Canadians. Opportunities for Malaysians. Opportunities that will strengthen the trade and investment ties between our countries, and position businesses, workers, and communities on both sides of the Pacific for a successful, sustainable, and secure future.
The Canadian minister explained that Canada and Malaysia have enjoyed 67 years of diplomatic ties, and throughout that time, both nations have been nurturing friendship and mutual prosperity. Last year we did USD4.7 billion worth of merchandise trade together. What’s more, that [merchandise] trade has grown 25% since 2018.
And with Malaysia having ratified the CPTPP free trade agreement in 2022 — and with a Canada-ASEAN free trade agreement on the horizon — Canada and Malaysia can look forward to building on this momentum.
“Malaysia, with its resilient economic fundamentals, growing middle class, talent pool, and infrastructure support, is an attractive regional hub for Canadian companies and investors. No wonder Canadian companies such as Manulife, Sun Life, Celestica, CAE, RBC, WSP Engineering, Greymont, BlackBerry, and Solmax are active here,” she said.
In fact, at all levels and across the full arc of the Indo-Pacific, Canada is finding new ways to enhance business-to-business ties with countries such as Malaysia which includes establishing the ASEAN-Canada Strategic Partnership in September 2023, and last month’s opening of Canada’s new Indo-Pacific Agricultural and Agri-Food Office in Manila, a regional hub that will build strategic partnerships to grow our export opportunities and increase the demand for Canadian products where the Canada-Malaysia trade and investment relationship is stronger than ever — and equipped to handle future challenges together.
The Team Canada Trade Mission delegation includes over 140 organisations (more than 250 individuals) across a wide range of sectors consisting primarily of small and medium enterprises with an interest in exploring opportunities in Malaysia. The Business Council of Canada, led by President and CEO Goldy Hyder, will also attend and be joined by a delegation of CEOs of large Canadian organisations.
As part of the TCTM event, delegates from both nations took part in an Information and Communication Technology (ICT) Sector Overview titled “Transforming Malaysia’s Economy Through Sustainable Digital Technologies” delivered by Deputy Minister of Digital Wilson Ugak Kumbong and Cleantech Sectoral Programme.
The event also saw the signing of an MOU between Canadian company Curve H2/Volterra and its Malaysian partner Forte Greenergy with third party stakeholders Tenaga National Berhad Research (TNBR), Sabah Oil & Gas Development Corporation (SOGDC), Sarawak Economic Development Corporation (SEDC) as well as Malaysian Green Technology and Climate Change Corporation (MGTC).
