THE US-Asean Business Council has called on Malaysia and the US to complete a double taxation treaty and to sign a trade and investment framework agreement (TIFA) that could pave the way to a free trade agreement (FTA).
Council officials discussed the issues at a meeting over the weekend with Second Finance Minister Datuk Jamaludin Jarjis and his delegation which were in the US capital for the spring meeting of the World Bank and the International Monetary Fund.
The councils senior director (acting) for Malaysian Affairs, John Phipps, said in a statement that the bilateral relationship between the two countries was vital and on track.
Council president Ernest Z. Bower said he expected progress in negotiations for a US-Malaysia taxation treaty and the initiation of TIFA.
We have asked our governments to complete the bilateral tax treaty for nearly a decade, he said.
Bower added that the issue which was holding up things was bank secrecy.
That issue has been fully addressed in a co-operative way during our joint effort to fight terrorism, so we in the business sector dont see any reason not to bring our mutual taxation system into accord and into the modern and competitive era, he said.
Bower said the council believed that a US-Malaysia TIFA could open the way to a free trade agreement (FTA).
Malaysian and American business need an FTA to be competitive especially since we are about to ink our FTA with Singapore later this year, he said.
Under the enterprise for the Asean Initiative announced by US President George Bush last October at the Apec meeting in Los Cabos, Mexico, the US is offering bilateral FTAs with Asean and a TIFA would be a perquisite for FTA negotiations.
Bower said that in their dialogue with Jamaludin, the Second Finance Minister gave them the chance to underline their strong commitment to Malaysia even in this difficult environment.
According to Bower, the US-Malaysia relationship has been in the news of late focusing on differences in the approach to the situation in Iraq.
The focus on Iraq by the media may make people who do not understand our relationship with Malaysia think we are not friendly or strategic partners. In fact, the opposite is true. The US and Malaysia are very close partners in trade, investment, education, security co-operation and in many other areas, he said.
Two-way trade between the US and Malaysia last year stood at US$34.4bil, the largest volume of bilateral trade with any Asean country. The US exports more to Malaysia than it does to such countries like India, Italy, Russia, Spain or Switzerland.
The US is consistently the top foreign investor in Malaysia, according to data from the Malaysian Industrial Development Authority. The US-Asean Business Council's membership includes 150 Fortune 1,000 American companies with trade and investment interests in Asean.
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