TWN Info Service on Free Trade Agreements

07 October 2008

(http://thestar.com.my/news/story.asp?file=/2008/10/2/nation/20081002151941&sec=nation)

Thursday October 2, 2008

Malaysia moving forward in FTA talks with US
By Jane Ritikos

KUALA LUMPUR: Malaysia is moving forward in the US-Malaysia free trade agreement talks following a new mandate on certain issues of contention, said International Trade and Industry Minister Tan Sri Muhyiddin Yassin.

He said the ad-hoc committee chaired by Deputy Prime Minister Datuk Seri Najib Tun Razak had given a new mandate to allow Malaysia to move forward in certain areas such as those pertaining to government procurement, competition policy, intellectual property (IP) and labour.

“In certain areas we needed to get clearance, for example IP, competition law and government procurement because earlier it was no talk at all, no opening for us to negotiate but the Cabinet has given some indication,” he told reporters Wednesday at the Hari Raya open house hosted by the Prime Minister and Muslim Cabinet ministers.

On whether this meant that Malaysia was opening up or adopting more flexibility in the issue of procurement, he said: “I don’t think you want to say that. It is certain aspects of procurement, and not a total package, which should be a non-binding discussion and exploratory, rather than a commitment.”

Muhyiddin added that a meeting should commence between the two sides before the end of the year.

He however said there was no set deadline to conclude the talks as Malaysia believed in working on a reasonable time-frame.

“It also depends on how the United States responds. They have high ambitions for us to move many things. What we do today cannot compromise our economic position. Of course in general we hope to boost trade but it must be on the basis of a win-win situation,” he said.

On the meltdown of the financial sector in the United State, he said the Government was monitoring closely the situation as it was serious and could impact the global economy.

He added that United States was still an important trade partner with 16% of the country’s global trade, and Malaysia was pushing hard for the FTA to come through. He acknowledged that export to United States and Europe had slowed down but fortunately Malaysia’s market had been diversified over the last two years to include China, India, Japan and the Middle East.

He hoped the situation in the United States and Europe would not have an impact on the total trade figure but rather that any impact would be compensated by trade with emerging markets.

“We have to keep monitoring especially for exports of electrical and electronic products which is still reasonably good and which we feel adds value to our exports,” Muhyiddin added.

He said the ministry would talk with exporters to find out the trade trends and problems. The Malaysia External Trade Development Corporation (Matrade) overseas had also been told to update the ministry on the situation as well as possible pre-emptive measures to be taken.