Malaysia is Australia's 9th-largest trading partner for goods and services in 2016-17. As a significant trading nation with a high proportion of the population classed as middle-income earners, it is a key market for many NSW exporters.

NSW and Malaysia's bilateral merchandise trade totalled A$4 billion in 2016-17, with NSW's exports to Malaysia valued at A$996 million. Major exports included coal, aluminium, medicinal and pharmaceutical products, wheat, copper and meat. Malaysia is also a growing source market for the NSW tourism industry, with the state welcoming 90,200 visitors from Malaysia in 2016-17.

At the end of 2016, Malaysian direct investment in Australia totalled A$20.4 billion. Australian companies continue to pursue opportunities in Malaysia, with Australia's foreign direct investment stock in Malaysia valued at A$5.6 billion as at December 2016.

The Malaysian Government's relaxed and liberalised investment regulations create a business-friendly environment, opening up opportunities for NSW companies in areas such as services and regional distribution.

Malaysia-Australia Free Trade Agreement

The Malaysia-Australia Free Trade Agreement that began on 1 January 2013 provides NSW goods and services exporters with an avenue into the dynamic Malaysian market. On the agreement entering into force, 97.6% of Australian goods exported to Malaysia were eligible for tariff-free treatment, and this will rise to around 99% in 2017 and 100% by 2020.

The NSW agribusiness sector in particular is set to benefit across a range of product categories.