Look to Africa, Matrade chief tells exporters

Matrade chairman Reezal Merican Naina Merican said in Africa, there is a big demand for fast moving consumer goods such as packaged goods, beverages, toiletries and other consumables. (Bernama pic)

GEORGE TOWN:

In light of rising shipping costs due to conflict in the Red Sea, Malaysian exporters have been asked to explore emerging markets such as Africa, Malaysia External Trade Development Corporation (Matrade) chairman Reezal Merican Naina Merican said.

He said that China and Asean are established markets, but Africa should be considered due to its significant political and economic transformation in recent years.

“It is a market of 1.4 billion people, with the World Bank, IMF and rating agencies improving their ratings. More than 50 countries are now democracies. It is time for us to look to Africa,” he told reporters.

The conflict in the Red Sea region has led to a significant increase in freight costs for Malaysian shippers, impacting the cost of imports and exports.

FMT previously reported shipping companies saying they were hit by a surge in insurance premiums and security measures, adding to trade expenses.

Reezal said that in Africa, there is a big demand for fast-moving consumer goods such as packaged goods, food and beverages, toiletries, as well as commodities such as palm oil.

He said there is also a chance for Malaysia to tap into multilateral agreements with African nations and the Common Market for Eastern and Southern Africa or Comesa, a 21-country economic bloc.

In 2023, Malaysia’s trade with Africa was valued at US$11.87 billion, with exports worth US$7 billion and imports worth US$4.87 billion.

Reezal said there is also a need to zoom in on North Africa for technological and educational transfer opportunities, especially in Libya.

He said the oil-rich country could use the expertise of Petronas in providing petrochemical education to its locals.

“Libya has one of the seven largest oil reserves in the world, so we must also tap into opportunities there. Their facilities have been run down post-Gaddafi era, and we must re-energise our diplomatic relations with them,” the former Malaysian deputy foreign minister said.

Reezal said Egypt was also receptive to Malaysian exports and investment, with Malaysian palm oil and palm oil product exports surpassing those of Indonesia.

“There is also a lot of demand in services in the construction, consultation, and mechanical fields in Egypt, and Malaysia is in a good position to provide expertise,” he said.

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Look to Africa, Matrade chief tells exporters

With conflict in the Red Sea driving up shipping costs, Reezal Merican Naina Merican says significant political and economic transformation means Africa is becoming a more appealing option.