Malaysia eyes stronger trade ties with Uzbekistan

New Straits Times

10 hours ago

TASHKENT: Malaysia is optimistic about a potential increase in bilateral trade with Uzbekistan, as both countries work to deepen cooperation in new areas such as halal certification, Islamic finance, tourism, and green technology.
In an interview with Bernama and RTM, here, Malaysian Ambassador to Uzbekistan Ilham Tuah Illias acknowledged a recent drop in trade volume, mainly due to import tax on palm oil.
However, he expressed confidence in a potential turnaround.
"We are hopeful that trade will pick up, if both governments can agree to waive or continue waiving the (import) tax on Malaysian palm oil. This would enable Uzbek retailers here to resume sourcing their palm oil supply from Malaysia," he said.
In 2024, Malaysia–Uzbekistan trade reached RM369.8 million (US$80.9 million), making Uzbekistan Malaysia's second-largest trading partner in Central Asia.
The trade balance was in Malaysia's favour at RM360.3 million (US$78.9 million).
From January to April 2025, bilateral trade between both countries reached RM106 million (US$25 million).
Major exports from Malaysia to Uzbekistan include palm oil, coffee, palm-based oleochemical, margarine and shortening, processed food and coconut oil, while imports from Uzbekistan comprise mainly fertilisers, fruits and textiles.
Ilham Tuah said the 5.0 per cent tax on Malaysian palm oil is being reconsidered by Uzbek authorities. A continued exemption could significantly boost Malaysia's exports.
"We hope this move will encourage Uzbek buyers to continue to source their supply from Malaysia. Discussions between the relevant authorities in both countries will be essential in finding a mutually beneficial solution," he added.
The ambassador also highlighted the importance of raising public awareness in Uzbekistan about the health benefits of palm oil.
"We must continue educating the Uzbek people about the nutritional value of palm oil and counter the negative narratives promoted by certain parties," he added.
On the tourism front, Ilham Tuah said that over 15,000 Uzbek tourists visited Malaysia last year—a significant increase from previous years, driven by enhanced air connectivity, including direct flights by Batik Air and Uzbekistan Airways.
"This improved connectivity benefits not only tourists but also students from Uzbekistan. Many are drawn to Malaysia's beaches, as Uzbekistan is a landlocked country," he explained.
He also noted a growing interest among Malaysian travellers in Uzbekistan, particularly for spiritual tourism.
"Many Malaysians visit Uzbekistan particularly for spiritual reasons. They love to explore the Imam Al Bukhari Mausoleum, which is currently under renovation. Once completed, it is expected to become a favourite destination for Malaysians," he added.
He said there is strong interest in Malaysia's halal certification in Uzbekistan, adding that the Malaysian Islamic Development Department (Jakim) has signed an MoU with the relevant Uzbek authorities to strengthen cooperation.
"This collaboration will help local products meet Malaysian halal standards, potentially opening access to broader markets that recognise our certification," he said.
To facilitate smoother trade and investment, both countries are currently exploring the possibility of establishing a Preferential Trade Agreement (PTA).
Ilham Tuah said with such a framework, Malaysia could send semi-finished goods for final processing in Uzbekistan, which has access to markets in the European Union and Eurasia.
"It's a win-win for both sides. Preferential trade agreement between Malaysia and Uzbekistan is something we are actively considering. So the relevant agencies of both countries should meet up to discuss and explore this further," he added.
Ilham Tuah also noted the growing demand in halal consumer goods and Muslimah fashion.
"Muslimah fashion is making a strong comeback here. So I encourage Malaysian women entrepreneurs to engage with their counterparts here. There is huge demand here for Muslimah fashion, cosmetics and halal products," he said.