KUALA LUMPUR: Malaysia, which has applied to join BRICS, also wants to resume free trade agreement (FTA) negotiations with the European Union (EU) towards finalising the pact while also in talks with ASEAN member states to strengthen trade further.

Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said trade with ASEAN countries only accounts for 23 per cent of total trade, thus offering Malaysia an opportunity to further boost trade with countries in the region.

In terms of payment settlement, he noted that there have been are discussions, mainly on a bilateral rather than multilateral basis, such as with China to use the ringgit and renminbi for trade settlement.

"But it is difficult to do so with other countries as the (local currency's) usage is not wide and the US dollar, of course, remains (the main currency used). We also have plans to increase the use of other foreign currencies.

"As to whether the move would prevent (certain) foreign investors from coming here given that the greenback is still being used widely, we have not seen it. However, in the long term, what's important for the investors is to see that the ringgit is stable as well before deciding to use the ringgit as base currency," he said in reply to a supplementary question from Datuk Seri Hamzah Zainudin (PN-Larut) on the first day of the current Dewan Rakyat sitting today.

Hamzah wanted to know whether the move to join BRICS is meant to reduce risks due to prolonged geopolitical conflicts and whether it would lead to a de-dollarisation as well as reduced presence of investors from the Middle East.

On a separate issue, Tengku Zafrul said Malaysia plans to focus on midstream and downstream industries to reduce exports of upstream products.

Answering a supplementary question from Datuk Seri Mohd Shafie Apdal (Warisan-Semporna) on efforts to enhance high-value exports, the minister gave the example of the government's move to ban exports of rare earth raw materials to encourage mid to downstream product exports.

As a result of the effort, Malaysia's exports jumped six per cent to about RM99 billion for the January-August 2024 period, Tengku Zafrul said.

Electrical and electronic products, which are mid to downstream products, made up the largest exports at almost 40 per cent of the amount.

"If we look at the production of palm oil and palm-based products as well as chemicals and chemical substances, which are also mid to downstream products, they comprise about 10 per cent, So upstream products are not a lot relative to the country's overall exports," he added.