Federal Councillor Guy Parmelin signs free trade agreement with Malaysia
Bern, 23.06.2025 — On 23 June, on the sidelines of the EFTA Ministerial Conference in Tromsø, Norway, a free trade agreement was signed by Federal Councillor Guy Parmelin and representatives of fellow EFTA countries Iceland, Liechtenstein and Norway with the Malaysian Minister of Investment, Trade and Industry, Mr Tengku Zafrul Aziz.
Signature of this agreement between the European Free Trade Association (EFTA) and Malaysia is a continuation of Switzerland's successful trade policy and makes the country more competitive. The agreement brings greater legal certainty and stability to economic ties with Malaysia. It also creates fresh economic prospects for Swiss companies.
The agreement closely aligns with more recent FTAs that EFTA has signed with third countries and covers a wide range of areas. Among other things, it includes provisions on trade in industrial goods, processed and unprocessed agricultural products, rules of origin, trade in services, protection of intellectual property rights, sustainable development and technical cooperation.
Lowering tariffs on palm oil
Nearly all products currently exported from Switzerland to Malaysia can be imported duty-free either immediately or after transition periods ranging from five to a maximum of ten years. For Malaysian palm oil, Switzerland has agreed to a market-compatible and quota-based reduction in tariffs so as not to adversely affect domestic production of vegetable oils. The agreement also includes a comprehensive section on environmental protection and labour rights. Among other things, it contains specific provisions to ensure that palm oil traded under the agreement is produced sustainably.
With bilateral trade in goods amounting to CHF 2.3 billion (2024), Malaysia is Switzerland's fourth largest trading partner in the ASEAN region after Singapore, Thailand and Vietnam. Swiss exports to Malaysia reached CHF 806 million in 2024, while imports stood at CHF 639 million (excluding gold and other precious metals). Malaysia is the second most important destination for Swiss direct investment in Southeast Asia after Singapore. The agreement opens up fresh opportunities for Swiss exporters, particularly in emerging technologies. Rich in natural resources, Malaysia is a major player in the global electronics industry and a leader in semiconductor manufacturing. It also offers a favourable investment climate with modern infrastructure and a well-educated, English-speaking labour force.
The Federal Council will now submit the signed agreement to the Swiss Parliament for ratification. The agreement will come into effect once the domestic ratification processes in the contracting states have been completed.