KOTA KINABALU, Aug 9 (Bernama) -- Malaysia's rich environmental heritage has great economic potential to serve as a renewable resource for the biotechnology industry, said head of the European Union Commission delegation to Malaysia, Thierry Rommel.

As such, he said, the European Union (EU) aimed to further improve cooperation with Malaysia, particularly in the field of research in biotech.

"Biodiversity is the key to the future of the high-growth pharmaceutical and biotech industries, and Malaysia's tropical forests are among the most diverse in the world," he said in his speech at the Sabah International Expo and Business Conference 2006 here Wednesday.

In this respect, he urged Sabah-based researchers to take a closer look at how the EU-funded research programmes could support their researches and link up Sabah-based researches with EU-base research institutions and networks.

"This arrangement will be ideal partners for Sabah's future biotech-based industry," he said.

Rommel said the main channel for cooperation between Europe and Malaysia is the EU sixth Framework Programme for research.

The programme provided 600 million euros (1 euro = RM4.66) support research cooperation with third countries during the period 2002-2006, with a particular focus on thematic areas of great interest for Malaysia, especially biotech.

"We are going to launch the 7th Framework Programme next year, covering the period 2007-2013 and reinforce EU support for research with a near tripling of funds available to improve cooperation with third countries.

"One field with considerable potential for joint research is biotech," he added.

On timber industry, Rommel said, the Malaysian government and the delegation of the European Commission to Malaysia were in the process of entering into such an agreement that would ensure the sustainability and legality of timber production and improve the perception of tropical timber in Europe.

"This is of immediate relevance to Sabah's economy and indeed the Sabah authorities are involved in that negotiation process that is steered on the Malaysian side by the Ministry of Plantation Industries and Commodities," he said.

He said future possibilities of mutually-beneficial cooperation in the field of energy are also considerable.

"Malaysia is the world's largest producer of palm oil and Europe is a major energy importer seeking alternatives to crude oil.

"Since bio-fuel is a renewable energy source, the potential for synergy in this field is obvious," he said.

-- BERNAMA