Business Today (28/04/2026) - Malaysia and the European Union (EU) are now in the final stage of concluding a Free Trade Agreement (FTA) as well as finalising a comprehensive partnership aimed at strengthening economic cooperation and bilateral relations.

Foreign Minister Datuk Seri Mohamad Hasan said the progress reflects a shift in EU priorities, with Southeast Asia now seen as a strategic bloc amid global trade disruptions, including unilateral tariffs by the United States and ongoing geopolitical tensions linked to the Russia-Ukraine conflict.

Without giving a timeline, Mohamad said Malaysia is pushing for the agreement to be concluded as soon as possible, noting that it could serve as a catalyst to further expand trade between both sides.

“I also mentioned this earlier during the meeting with EU representatives,” he told Bernama and RTM after a bilateral meeting with EU High Representative for Foreign Affairs and Security Policy Kaja Kallas on the sidelines of the 25th ASEAN-EU Ministerial Meeting.

EU Trade Commissioner Maroš Šefčovič had previously indicated that the Malaysia-EU FTA is expected to be finalised this year, with bilateral trade, which stood at about €46 billion, expected to grow significantly once the agreement is implemented.

Mohamad said discussions with Kallas also covered long-standing concerns over anti-palm oil campaigns in Europe, which Malaysia has consistently rejected.

He stressed that the campaigns are not based on scientific evidence but are driven by lobbying from competing oil industries in the region.

“I said that it is unfair because labelling food as containing palm oil clearly violates trade ethics,” he said.

According to Mohamad, Kallas acknowledged Malaysia’s position and expressed openness from the EU to help address the issue.

The minister also raised concerns over the EU Deforestation Regulation (EUDR), urging Brussels not to equate Malaysia’s forestry standards with those of other producing countries.

“More than 55 per cent of our land is still covered by tropical forests, and we do not destroy forests to plant oil palm,” he said.

He emphasised that Malaysia’s palm oil sector is largely managed by professional plantation companies that comply with the Malaysian Sustainable Palm Oil (MSPO) certification standards.

Mohamad also highlighted Malaysia’s focus on exporting higher-value processed palm oil products rather than crude palm oil, noting strong demand from Europe.

“The European Union is a major importer of processed palm oil. Therefore, this is a profitable market for us,” he said, adding that Malaysia will continue efforts to counter anti-palm oil campaigns affecting trade perceptions.

He said Malaysia hopes continued engagement will lead to better EU understanding of its palm oil practices and a more balanced approach to trade-related environmental policies.

Read more at https://www.businesstoday.com.my/2026/04/28/malaysia-eu-free-trade-deal-nears-final-stage-mohamad-hasan/