Reform Must Become Part Of The ASEAN Way To Withstand Global Shocks - Tengku Zafrul

By Rosemarie Khoo Mohd Sani

KUALA LUMPUR, Aug 7 (Bernama) -- The Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz has called for structural reforms to continue nationally and on the ASEAN level, noting that the region must remain strong in the face of rising geopolitical and economic uncertainties.

He said there is value in the willingness to dialogue with all like-minded partners and in upholding the principles of non-alignment.

He said ASEAN has remained intact in the face of “Liberation Day” challenges and has arguably delivered “what we as a region needed, where and when it mattered.”

"The process of diversification and economic integration must go on. Reform must also continue because, after all is said and done, a 680-million strong ASEAN market is a valuable resource to ‘tide us over’ during this fractured era," he said in his speech at the PRAXIS 2025 Public Policy Conference here today. 

He said the tariffs posed a challenge to ASEAN’s unity and coherence but the block held on to its non-retaliatory approach.

He also noted that Malaysia is not facing the situation with a fractured national or regional stand despite being in uncharted waters.

“While the negotiations were not easy, we have the best possible deal we could, one which, while addressing key concerns in US-Malaysia bilateral trade, upholds our key national interests and red lines," he said.

He said the US market remains crucial but it is undoubtedly going through a phase where rules-based trading is becoming less clear, causing uncertainty, possibly for a generation. The tariffs have also generated uncomfortable questions about its economic models. 

"While the best change is not necessarily the most drastic, we may need to have deep, frank conversations on where we are going and what needs to be done," said Tengku Zafrul.  

Meanwhile, he said Malaysia remains focused on delivering key transformation blueprints such as the New Industrial Master Plan 2030 (NIMP 2030) and the 13th Malaysia Plan (13MP), which promote innovation, inclusivity and long-term resilience.

Malaysia has signed and implemented nine bilateral and nine regional free trade agreements (FTAs) as it remains steadfast in its support of an open, transparent and rules-based global trade order, he said.

This includes the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), two of the world’s largest trade agreements. 

There are also ongoing negotiations with the European Union (EU), Gulf Cooperation Council (GCC) and South Korea. 

"The success of these policies will help regional conversations, as to how ASEAN can build stronger institutions and more connected economies, not from a place of suspicion, but from one of strength and confidence," said Tengku Zafrul.

As the 2025 ASEAN chair, Tengku Zafrul said Malaysia has tabled 18 priority economic deliverables (PEDs) with more than half of trade-related targets already met, including the conclusion of negotiations to upgrade the ASEAN Trade in Goods Agreement (ATIGA) and the ASEAN-China Free Trade Area (ACFTA).

“These upgraded agreements, expected to be signed in October, expand cooperation into services, e-commerce and SMEs. This marks a step forward in transforming ASEAN into a more cohesive economic bloc,” he said.

Tengku Zafrul also referred to the upcoming ASEAN Digital Economy Framework Agreement (DEFA) and Malaysia’s proposal for an ASEAN Framework on Integrated Semiconductor Supply Chain (AFISS) as crucial next steps for the region.

-- BERNAMA