KUALA LUMPUR: Malaysia should be given the Common Effective Preferential Tariff (CEPT) of 5% for exports of completely-built-up (CBU) motor vehicles to Thailand and other countries in the Asean Free Trade Area (Afta), said International Trade and Industry Minister Datuk Seri Rafidah Aziz.
Responding to a recent report that Thailand would not lower its import duty on Malaysian cars, as Malaysia required carmakers to be registered for approvals, Rafidah said the subject was open for discussion.
Quoting Article 4 of the CEPT agreement, Rafidah said Malaysia was entitled to the CEPT for its vehicles shipped to Thailand because Malaysia had reduced its import duties on CBU cars from Asean to 5%. Moreover, Article 4 did not impose any other conditions such as approval registration, for a member country to obtain entitlement, she said.
“Thailand will be sending a delegation to discuss this issue next month, and they are most welcome to do so because we believe this is a matter of interpretation (of the agreement),” she told a media conference after chairing the 20th Meeting of the Afta Council yesterday.
On another matter, Rafidah said it was important for Asean members to adhere to a “standstill” on non-tariff barriers to allow freer trade between the member countries.
“It is important not to add to the amount of non-tariff barriers already in place for maybe the last 20 years, even if members find reducing some of these barriers to be tough. It allows the market to at least understand that these barriers are all there are now, then work can be done to remove as many of these as possible,” she added.
However, she also said it was understandable that some of these non-tariff measures were hard to remove as they were embedded into the constitution of the country, and removing them might require a long time and much effort.
“It is easy to eradicate these barriers if they exist only as ‘business practices’. But if they are written in the constitution, then the removal might need parliamentary approval, and might last to the next government,” Rafidah said.
Asean secretary-general Ong Keng Yong said the barrier “standstill” would keep local industries on their toes, and they would realise they could not rely on their respective governments for protection anymore.
“It would then spur these industries to produce something their customers actually want, for them to be competitive in the market without any advantage,” Ong said.
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