UNJournal Jon Lee |  The following article was contributed by the Embassy of Uzbekistan in Seoul to Diplomacy Journal for publication. --Ed.

Uzbekistan’s foreign economic activity, focused on a proactive and practical approach emphasizing mutual respect and consideration of interests, comprehensively contributes to strengthening multifaceted and mutually beneficial ties with various countries worldwide.

The diversification of investment and trade cooperation, the desire to open new markets and establish mutually beneficial cooperation beyond the nearest regions, is bearing fruit, and one of the striking examples is the growing interaction with the countries of Southeast Asia.

Malaysia holds a special place in this region, having quickly become a reliable and proven partner for Uzbekistan. The friendly and trusting relations between the heads of state significantly contribute to the development and strengthening of cooperation between the government and business circles of the two countries.

By consistently creating a stable foundation for bilateral interaction, Uzbekistan and Malaysia focus primarily on increasing trade and investment cooperation, expanding the range of trade and increasing the number of joint ventures and the scope of their activities.

For example, an Intergovernmental Agreement on Trade has been concluded between the countries, on the basis of which the most favorable trade regime has been introduced. Thanks to this, the volume of mutual trade has grown by 30 percent since 2021. The list of goods supplied includes mineral fertilizers, fresh and processed fruits and vegetables, palm oil, technological equipment, tea and coffee, hygiene products, textile industry products, and other goods and services.

Interregional ties between the business circles of the two countries are being established. The "Made in Uzbekistan" fair was organized as part of the visit of the Uzbek delegation to the state of Selangor in December of last year. 21 exporting companies took part in it. Products worth $1.2 million were sold directly at the event. In addition, a number of long-term export contracts were signed.

Malaysia also seeks to create a kind of logistics hub that allows for the export of goods both to the domestic market of Uzbekistan and to the markets of neighboring states, fully utilizing the existing preferential trade regimes. To this end, in 2019, a representative office of the Malaysian Corporation for the Development of Foreign Trade (MATRADE) was opened at the Malaysian Embassy in Tashkent.

Investments are another pillar that forms the solid foundation on which Uzbek-Malaysian economic relations are built. The sphere is regulated by signed Intergovernmental Agreements on the promotion and mutual protection of investments and on the avoidance of double taxation. At the same time, Uzbekistan has created the most favorable business environment for foreign investors, introducing tax and customs benefits and preferences and ensuring the legal protection of the rights and interests of investors.

Today, 39 enterprises with Malaysian capital operate in Uzbekistan, and this number tends to grow rapidly - in 2024 alone, 15 new enterprises were created. The activities of companies are very diverse, including grain and tea processing, confectionery production, geology, metalworking, energy, construction, programming, consulting services, education, tourism, real estate and construction, financial services, wholesale and retail trade.

In February last year, an Uzbek-Malaysian business forum was held in Kuala Lumpur, following which agreements were reached on the implementation of 23 projects in the fields of energy, electrical engineering, agriculture, food industry, metallurgy, pharmaceuticals, furniture and jewelry industries.

In May of the same year, another business forum was held in the Uzbek city of Samarkand, which was crowned with agreements totaling $3.3 billion. In particular, 19 projects worth $1.1 billion were agreed upon in the fields of chemistry, electrical engineering, food industry, energy, IT, infrastructure development, geology, and the banking and financial sector.

The successful implementation of projects is a comprehensive result of the purposeful work of businesses in a favorable investment environment and state support. The latter is among the tasks of the Uzbek-Malaysian Intergovernmental Commission on Trade and Economic Cooperation, which considers the progress of the implementation of agreements, provides assistance, and develops new directions for sustainable cooperation between the two countries.

The first meeting of the Uzbek-Malaysian Intergovernmental Commission on Trade and Economic Cooperation was held in 2024 in Kuala Lumpur with the participation of Laziz Kudratov, Minister of Investment, Industry, and Trade. The second will be held in Uzbekistan - in the city of Khiva in September of this year.

Interaction between the two states in the field of transport is expanding. This direction is regulated by a bilateral intergovernmental agreement on air services, as well as agreements between the aviation administrations of the two states.

In 2023, a total of 226 flights were operated on the Tashkent-Kuala Lumpur route with Malaysia, which is 6.2 times more than in the previous year. The total volume of cargo transportation also increased by 3.5 times.
In addition, Uzbekistan is interested in joint work on using the infrastructure of ports and the opportunities of maritime trade that Malaysia has to enter new promising markets.

In general, a number of factors can be identified that ensure the desire of the two countries to strengthen relations: the digitalization of the economy, the intensification of trade and industrial cooperation with the active use of transport and logistics opportunities to enter regional consumer markets on a mutual basis, and, undoubtedly, the similar nature of national strategies coupled with the need to build sustainable cooperation in the context of a rapidly changing international economic situation.