KUALA LUMPUR: The Federation of Malaysian Manufacturers (FMM) has asked the Government to ratify the Trans-Pacific Partnership Agreement (TPPA), as it provides access to a huge duty free market.
Under the TPPA, tariffs will be removed on 85% of Malaysia’s trade with its new free trade agreement (FTA) partners, namely Canada, Mexico, Peru and the United States, and save US$$1.2bil (RM5.3bil) in tariffs for Malaysian industry.
The federation’s president Datuk Seri Saw Choo Boon said automotive, machinery and equipment, electrical and electronics (E&E) products, textile and apparel and rubber products were among products to benefit from duty free access.
Meantime, Malaysia will eliminate import duties for several sensitive product like E&E, petroleum and chemicals that open up more opportunities for manufacturers to procure better quality raw materials.
“We call on all parties, especially the government to take the important step in becoming part of the TPPA.
“With the uncertainties in the global trading environment, especially in traditional export markets, can Malaysia afford not to sign important FTAs like the TPPA and later, other FTAs in the pipeline like the European Union - Malaysia FTA or the Regional Comprehensive Economic Partnership?
“If we fail to conclude the TPPA, our Asean neighbours, Vietnam, Singapore and Brunei will move ahead strongly,” Saw said.
He said Malaysia had benefited from the FTAs signed thus far and there was ample evidence that liberalising economies like Chile, China and South Korea have performed better than more inward-looking ones at comparable stages of development.
“The private sector, in particular manufacturers, service providers, investors and others who run businesses, employ workers and sell products and services, strongly advocate for FTAs, including the TPPA,” he added.
He said trade and investment are Malaysia’s lifeline and play an important role in economic growth and transformation.
“This is evident in the fact that Malaysia is the fourth most trade-dependent nation after Hong Kong, Singapore and Vietnam with total trade accounting for 1.5 times of the gross domestic product.
“We recognise the limits of the domestic market.
“We know that we can only generate new and additional sources of growth and investment by expanding our boundaries to the rest of the world, a promise that the TPP and other FTAs hold,” Saw added.
As at Dec 1, 2015, the World Trade Organisation reported that 619 FTAs had been signed worldwide and 413 had come into force. - Bernama
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