South Korea-Malaysia Trade Set To Exceed US$40 Bln In 2026

KUALA LUMPUR, Oct 9 (Bernama) -- Bilateral trade between Malaysia and South Korea is expected to exceed US$40 billion this year, with the two countries poised to deepen economic ties following the conclusion of negotiations on their Free Trade Agreement (FTA).

Outgoing South Korean Ambassador to Malaysia Yeo Seung-bae said South Korea had risen from Malaysia’s ninth-largest to seventh-largest trading partner, with bilateral trade growing from around US$20 billion to nearly US$30 billion in just five years.

He added, the trade volume is expected to exceed US$40 billion this year.

“Once our FTA enters into force, Korea will become one of Malaysia’s top five trading partners,” he said in his remarks at a farewell reception held at his residence here on Thursday.

Also present were Minister in the Prime Ministerss Department (Federal Territories) Hannah Yeoh, Science, Technology and Innovation Minister Datuk Chang Lih Kang and Deputy Economy Minister Datuk Seri Mohd Shahar Abdullah.

Yeo underscored that the growth reflected the broader momentum in the Korea-Malaysia Strategic Partnership, particularly in economic and security cooperation.

The two countries elevated their relations to a Strategic Partnership in November 2024, during Prime Minister Datuk Seri Anwar Ibrahim’s official visit to Seoul.

A memorandum of understanding on defence industry cooperation was subsequently signed in 2025, paving the way for deeper cooperation in defence and technology.

Yeo said the first two South Korean FA-50 fighter jets were expected to arrive in Malaysia this month, with all 18 aircraft scheduled for delivery to Kuantan Air Base by 2028.

He said work was also progressing on the installation of the Haegung surface-to-air anti-missile system on two of Malaysia’s LMS Batch 2 ships – KD Jebat and KD Lekiu. 

He also expressed hope for South Korean participation in Malaysia’s multi-role support ship (MRSS) projects, saying such cooperation would strengthen Malaysia’s defence capabilities while creating opportunities in shipbuilding and bilateral supply chains.

Yeo said South Korean companies were exploring opportunities in the upstream and downstream rare earth industries in Perak and Pahang.

He also highlighted growing South Korean investment in Malaysia, including the expansion of Samsung SDI’s battery manufacturing facilities and Simmtech’s semiconductor operations, as well as Hyundai’s commencement of local vehicle assembly.

Reflecting on his four-year tenure since arriving in Kuala Lumpur in October 2022, Yeo expressed appreciation for the cooperation and friendship extended to him by all parties he met throughout his assignment here.

“Malaysia will always hold a special place in my heart. When I look back on the past four years, I am proud of what our two countries have accomplished. 

“I will always remember you, your kindness, generosity, and the warm hospitality you have shown me throughout my time here. Although I will soon be leaving Malaysia, I will never leave Malaysia behind,” he said.

-- BERNAMA