Enhancing Exports to Venezuela: A New Strategic approach by Malaysia
In a significant turn of events, recent developments are indicating promising opportunities for Malaysian exports to Venezuela, particularly in sectors such as food-related products, rubber gloves, furniture, and wood products. This shift is largely driven by evolving trade agreements and market dynamics, including the revival of the Iran-Venezuela Free Trade Agreement.
Last year, Malaysia was Venezuela's 35th largest trading partner, with total trade amounting to RM398.38 million. Notably, Malaysian exports accounted for RM148.26 million of this total. Electrical and electronics products were the largest export items, accounting for 31.1% of total exports. However, the Iran-Venezuela free trade pact, finalized in June 2025, is set to expand these opportunities.
Although Malaysia is not a direct party to this agreement, the expanded trade environment and Venezuela’s interest in diversifying trading partnerships create openings for Malaysian exports. The bilateral agreement, which covers agricultural, fisheries, and industrial products, focuses on rules of origin, sanitary and phytosanitary requirements, and product lists. This agreement aims to increase bilateral trade and enable both countries to act as trade hubs in the Americas and Asia.
In the food sector, Malaysian processed foods and agricultural goods could meet Venezuelan demand, benefiting from reduced tariffs and streamlined import procedures. Malaysia's globally competitive rubber glove industry stands to capitalize on Venezuela’s healthcare and industrial sectors, particularly as the Iranian-Venezuelan trade framework boosts industrial goods exchanges. Venezuela’s agricultural and industrial diversification strategies potentially favor imports of Malaysian furniture and wood products, supported by compliance with phytosanitary measures outlined in the agreement.
However, it is important to consider geopolitical and trade risks. For example, U.S. sanctions related to Venezuelan oil complicate direct trade, and potential tariffs or import regulations elsewhere may impact supply chains. Malaysian exporters should monitor ongoing international trade policies and compliance requirements to optimize market entry strategies.
The government is actively encouraging Malaysian companies to increase exports of products and services to Venezuela. To facilitate this, the ministry plans to encourage shipping companies to explore and penetrate the Venezuela market. Furthermore, with the proposed warehouse, products from companies could be collected at one place and shipped directly to Venezuela.
Between January and February this year, total trade between Malaysia and Venezuela rose six fold from the same period last year. This surge in trade is an encouraging sign for Malaysian exporters looking to tap into the Venezuelan market. With these opportunities in sight, it is an exciting time for Malaysian businesses to explore the potential of the Venezuelan market.
[1] Iran-Venezuela Free Trade Agreement Revival: https://www.reuters.com/world/americas/iran-venezuela-finalize-free-trade-agreement-2021-06-08/ [2] Venezuelan Markets May Become More Accessible to Malaysian Exports: https://www.bloombergquint.com/onweb/venezuelan-markets-may-become-more-accessible-to-malaysian-exports [3] Trade Challenges and Considerations: https://www.jstor.org/stable/26734760
- As the Iran-Venezuela Free Trade Agreement revival opens up new opportunities for Malaysian exports, the finance sector can leverage these developments to support businesses expanding into the Venezuelan market.
- The evolving business landscape in Venezuela, driven by the revival of the Iran-Venezuela Free Trade Agreement and government incentives, presents a significant opportunity for Malaysian firms in industries such as finance, food, rubber gloves, furniture, and wood products.
