Malaysia's trade is expected to bounce back and grow possibly up to five per cent next year, said Malaysia International Trade and Investment (Miti) Minister Datuk Seri Mustapa Mohamed.
"2012 is a tough year but I think we can do slightly better next year," he told reporters after launching the Miti essay writing competition for public universities here yesterday.
Malaysia recently revised its trade growth forecast to between 4-4.5 per cent from 5-6 per cent this year as on-going issues in the US and Europe continued to weigh down the world economy.
However, despite the gloomy global outlook, the International Monetary Fund recently maintained its forecast for Malaysia at 4.4 per cent this year and a 4.7 per cent growth next year.
Mustapa said trade in 2013 will be driven by domestic private consumption as well as investments under the Economic Transformation Programme (ETP) that will help to cushion any external uncertainties.
Trade with China will continue to strengthen but he noted that Asean will play an important role in future growth prospects.
"It must be noted that 25 per cent of our trade is inter-Asean. I believe the numbers can go up further," he said.
Mustapa said the recently concluded peace deal in southern Philippines could help boost economic ties between both countries.
Total trade between Malaysia and the Philippines dropped 22 per cent to US$5.1 billion (RM15.5 billion) last year because of the global economic downturn.
On another note, Mustapa said he was confident that negotiations on the Free Trade Agreement (FTA) with Turkey will be concluded by the end of this year.
"We had some challenges but I expect an agreement could be formalised in the next few days before it is presented to the Cabinet," he said.
Once concluded, Malaysia will be the first Asean nation to sign an FTA with Turkey.