MARKET DEVELOPMENT
TPP Boost to Trade Volume
TPP Boost to Trade Volume
06/08/2014 (Business Times) - Malaysia's trillion ringgit trade volume can be expanded further with its participation in the Trans Pacific Partnership (TPP), as well as a free trade agreement (FTA) with the European Union (EU), says International Trade and Industry Minister Datuk Seri Mustapa Mohamed.
“We have been doing well because of the open market created by the World Trade Organisation (WTO), Asean Free Trade Area (Afta) and FTAs.
“FTAs currently provide preferential access for 63.5 per cent of Malaysia’s trade, including with Asean, China and Japan. Access to these markets for the majority of our exports is already duty-free,” he said.
Malaysia has bilateral FTAs with Turkey, Pakistan, New Zealand, Chile, India, Australia and Japan.
The TPP and EU FTA will provide another nine and 10 per cent in preferential access, respectively.
“With the removal of tariffs and additional preferences, Malaysian exporters stand to enjoy a better footing than neighbouring competitors.”
The EU FTA talks have been placed on hold but the TPP grouping talks have forged actively ahead in the past four years.
Eleven other Pacific Rim countries are involved in the TPP negotiations, and they are Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States.
Mustapa highlighted five areas in which Malaysians stand to benefit in terms of market access due to tariff elimination which are electrical and electronics products; rubber gloves; palm oil and palm oil products; plywood; and timber and timber products.
For instance, in the area of electrical and electronics products, the current import duty ranges from three to five per cent for the United States, and Canada (five to 11 per cent), Mexico (five to 15 per cent) and Peru (nine per cent).
Rubber gloves, an export product Malaysia is widely acclaimed for, has the potential to enter Canada, Mexico and Peru, where the current import duty ranges between nine and 15.5 per cent.
Mustapa added that palm oil and palm oil products will also find easier access to Canada and Peru.
“We are currently negotiating for zerorated tariffs to come into effect immediately with the conclusion of the agreement.”
Negotiators held their last meeting in Ottawa, Canada, last month.
Although there has been some progress in resolving technical issues, many sensitive issues remain outstanding, namely intellectual property rights, investor-state dispute
settlement, government procurement (GP), environment and state-owned enterprises (SOEs).
US Trade Representative Michael Froman, who was here recently, said the country recognised Malaysia’s Bumiputera policy and its importance to the country, both economically and socially, and would consider it in discussions in the areas of GP and SOEs.
“We have been doing well because of the open market created by the World Trade Organisation (WTO), Asean Free Trade Area (Afta) and FTAs.
“FTAs currently provide preferential access for 63.5 per cent of Malaysia’s trade, including with Asean, China and Japan. Access to these markets for the majority of our exports is already duty-free,” he said.
Malaysia has bilateral FTAs with Turkey, Pakistan, New Zealand, Chile, India, Australia and Japan.
The TPP and EU FTA will provide another nine and 10 per cent in preferential access, respectively.
“With the removal of tariffs and additional preferences, Malaysian exporters stand to enjoy a better footing than neighbouring competitors.”
The EU FTA talks have been placed on hold but the TPP grouping talks have forged actively ahead in the past four years.
Eleven other Pacific Rim countries are involved in the TPP negotiations, and they are Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States.
Mustapa highlighted five areas in which Malaysians stand to benefit in terms of market access due to tariff elimination which are electrical and electronics products; rubber gloves; palm oil and palm oil products; plywood; and timber and timber products.
For instance, in the area of electrical and electronics products, the current import duty ranges from three to five per cent for the United States, and Canada (five to 11 per cent), Mexico (five to 15 per cent) and Peru (nine per cent).
Rubber gloves, an export product Malaysia is widely acclaimed for, has the potential to enter Canada, Mexico and Peru, where the current import duty ranges between nine and 15.5 per cent.
Mustapa added that palm oil and palm oil products will also find easier access to Canada and Peru.
“We are currently negotiating for zerorated tariffs to come into effect immediately with the conclusion of the agreement.”
Negotiators held their last meeting in Ottawa, Canada, last month.
Although there has been some progress in resolving technical issues, many sensitive issues remain outstanding, namely intellectual property rights, investor-state dispute
settlement, government procurement (GP), environment and state-owned enterprises (SOEs).
US Trade Representative Michael Froman, who was here recently, said the country recognised Malaysia’s Bumiputera policy and its importance to the country, both economically and socially, and would consider it in discussions in the areas of GP and SOEs.