KUALA LUMPUR: Asean’s neutrality offers a rare, viable platform for trade, technology collaboration and investment with all major economic players, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.
He said Asean’s consistent engagement with both the United States and China, without aligning with any single strategic orbit, has preserved the policy space many regions lack.
“This deliberate posture preserves autonomy while enhancing Asean’s economic appeal,” he said during a talk on “Building Regional Strength through Smarter Fiscal and Trade Policies” here today.
Tengku Zafrul said that over the past year, Malaysia has had the honour of chairing Asean, during a period marked by geopolitical fragmentation and great power rivalry.
Despite these challenges, he said, Asean demonstrated resilience, cohesion, and stability, reaffirming its role as a vital anchor of economic balance and strategic neutrality.
“Meanwhile, one key insight from Malaysia’s Asean chairmanship is that the region’s relevance has grown in step with intensifying global polarisation.
“As major powers recalibrate and supply chains realign around geopolitical shifts, Asean’s balanced and forward-looking stance has become a valuable stabilising force,” he added.
He said at the 47th Asean Summit, Malaysia, as part of Asean, also signed the upgraded Asean-China Free Trade Agreement 3.0, reinforcing the longstanding economic partnership with China.
Additionally, the Asean Trade in Goods Agreement (Atiga) Upgrade, concluded during Malaysia’s Asean chairmanship, also marked a pivotal step toward deepening regional economic integration.
“In an era where resilience and agility increasingly determine competitiveness, the Atiga Upgrade lays the institutional foundation for this region to function as a more seamless, trusted single market, enhancing its appeal for investments.
“Indeed, in 2024, Asean defied global trends with an 8.5% increase in foreign direct investment, reaching US$228 billion (RM952 billion). With Atiga’s upgrade, I am confident this momentum can be sustained,” he said.
Meanwhile, for the Asean Digital Economy Framework Agreement (Defa), the Asean digital economy is projected to reach US$1 trillion by 2030.
With Defa, advanced under Malaysia’s leadership, this is set to double to US$2 trillion, he said.
On green transition and industrial decarbonisation, he said Asean has made progress on the Asean Power Grid that will revolutionise and create closer integration in the regional energy sector.
Tengku Zafrul also said the Agreement on Reciprocal Trade (ART) is a sovereign, rules-based mechanism that reinforces Malaysia’s ability to sustain stable, predictable commercial ties with major economies, especially at a time when unilateral tariff actions are becoming the norm.
He said the ART inked with the US must therefore be viewed within this broader context of principled engagement with key trading partners.
“Nothing in the ART overrides Malaysian law, diminishes national sovereignty, or forces liberalisation beyond our chosen policy direction. All provisions are grounded in Malaysian laws, with red lines protected. The key is to secure a platform for continued engagement, for resolving issues of common concern,” he said.
Tengku Zafrul said, critically, the ART enhances trade predictability and anchors Malaysia within a global, rules-based framework.
It also provides certainty for exporters and strengthens the investment ecosystem.
“In today’s landscape, where economic security increasingly shapes market access, the ART is a tool of strategic protection, not concession. With almost RM200 billion in exports in 2024, protected access and sustained competitiveness are non-negotiable,” he added.
The minister also emphasised that the government is striving to keep the investment community informed throughout the ART negotiation process with the US.
“Thankfully, this has contributed to the positive growth momentum of our trade and investment inflows,” he said.
From January to September 2025, Malaysia attracted RM285.2 billion in approved investments, marking a 13.2% year-on-year increase, Tengku Zafrul said.
He noted that foreign investments accounted for 52.9% (RM150.8 billion) in approved investments, while domestic investments contributed 47.1%, a solid reflection of both foreign and domestic investors’ confidence in Malaysia’s policy direction.
“Our stellar trade and investment numbers also came against the backdrop of 5.2% gross domestic product (GDP) growth in the third quarter of 2025, beating analysts’ expectations. This was the fastest growth pace in a year, bringing the 9M2025’s growth to 4.7% ,” he said.
Hence, Tengku Zafrul said, Malaysia is poised to end the year at the upper end of the central bank’s GDP growth forecast of 4%-4.8% for 2025, given the strong growth momentum in the third quarter. – Bernama
