KUALA LUMPUR, Jan 21 (Bernama) -- Despite being the 17th largest tradingnation, many Malaysian exporters are yet to fully exploit countertrading,which could increase access to some potential markets in the region.This is due to ignorance of the works of countertrade, lack of knowledgeon how to negotiate contracts or to cover risks, Malaysian External TradeDevelopment Corporation's (MATRADE) chief executive officer Merlyn Kasimirsaid Tuesday.

Many exporters are comfortable with their traditional way of trading andconsider countertrade a high risk activity, he said in his opening addressat MATRADE's workshop on Counter Trade, Offset and Structured Financehere.

He said these exporters, however, failed to understand that countertradecould also offer a viable means for market access and penetration intodifficult markets.

While Malaysia's trading in the past decade has been oriented towards themore matured markets of the developed world, he said emerging markets thathold the potential to absorb the country's export should also be tapped.

"To increase the level of trade with these emerging markets (Aseancountries & China), you may need to involve some type of countertradedeals that must be evaluated in the same way as the more established meansof trading," he said.

Countertrade could become a vital tool for securing new markets and usedas a successful competitive strategy to enhance trade, he pointed out.

A major sector currently involved in countertrade is palm oil due to thehuge demand for it, he added.

On MATRADE's efforts to encourage more countertrading, he said it wouldcontinue to point out the benefits to exporters through seminars andworkshops.

The continuous education on countertrade would be important as the growingcompetition and globalisation have made it more complicated amid currencyfluctuations and foreign exchange shortage, said Merlyn.

He said the World Trade Organisation (WTO) was also working at agreementsto develop effective countertrade principles for a win-win situation amongcountries that countertrade.

MATRADE said that between 20 and 30 percent of the world's trade todaywere transacted through countertrade and its annual market size worthestimated at US$200 billion (RM780 billion) to US$500 billion (RM1,900billion).

On other developments, Merlyn said that MATRADE in collaboration with theMalaysian Industrial Development Authority (MIDA) has planned for seventrade missions for the current year.

The trade missions will be led by International Trade and IndustryMinister Datuk Seri Rafidah Aziz.

He said the first mission would be from Feb 24 to March 1, 2003 to threeAsean countries namely Manila, Jakarta and Bangkok and later in May to theMiddle East countries of Lebanon, Saudi Arabia, Dubai and Bahrain.

Trade missions have been also planned to Japan, Korea, United States,Europe and China.

-- BERNAMA