Malaysia is a party to the negotiations on the Regional Comprehensive Economic Partnership (RCEP), which is a free trade agreement between the ten ASEAN members and six countries with which ASEAN has already concluded free trade agreements. The objective of RCEP is a more comprehensive integration of the regional economic policy of its members. RCEP also aims to simplify and harmonize member countries` respective bilateral free trade agreements. The negotiating members of RCEP are: Australia, Brunei, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand and Vietnam. If RCEP is accepted, it will be Malaysia`s largest multilateral agreement, accounting for about 29% of world trade. The previous government had declared its intention to conclude the RCEP agreement in 2018, but this internment was not repeated by the new government. The Malaysia-Iran Preferential Trade Agreement (MIPTA) was initiated by the previous Malaysian government. The start of negotiations was announced during a Malaysian trade mission to Iran in May 2016. Since then, there have been no publicly available updates on MIPTA.
Negotiations on a Malaysia-EU Free Trade Agreement (MEUFTA) were officially launched on 5 October 2010. After several rounds of negotiations, negotiations reached an impasse in 2012. However, both sides were greedy that negotiations would resume if a new mandate and/or flexibilities were available at a later date. The new government has not yet commented on the possible resumption of MEUFTA negotiations. Incidentally, Malaysia and the EU concluded the Partnership and Cooperation Agreement (PCA) in December 2015. Malaysia and the EU intended to sign the PCA in January 2019. A PCA is a comprehensive bilateral and multilateral cooperation agreement covering politics, economy, trade, investment, justice, culture, education, science and technology, health, agriculture, tourism, energy, transport and environment. Individual ASEAN members must first sign a PCA with the EU to be eligible for the Free Trade Agreement (FTA). In addition, Malaysia is in ongoing negotiations with the European Free Trade Association Partnership. The European Free Trade Association (EFTA) countries, consisting of Iceland, Liechtenstein, Norway and Switzerland. These members are not members of the European Union. Negotiations between EFTA and Malaysia are still ongoing.
MICECA is a comprehensive agreement covering trade in goods, trade in services, investment and movement of natural persons. It reinforces the benefits of the ASEAN-India Agreement on Trade in Goods (AITIG) and will further facilitate and enhance mutual trade, services, investment and economic relations in general. Malaysia has always been a trading nation. Strategically located on the Strait of Malacca, it lies on a major navigation channel that connects the Indian Ocean to the west and the Pacific Ocean to the east. Malaysia recognizes the importance of trade and international relations for the country`s growth and development. This is reflected in gross exports of goods and services. Given Malaysia`s dependence on international trade, Malaysia has pursued a liberal trade policy and attaches great importance to regional and bilateral trade agreements. Malaysia acceded to the General Agreement on Trade and Customs (GATT) in 1957, making it a founding member of the World Trade Organization (WTO), which replaced gatt. Bilateral agreements Trade with India amounted to US$10.77 billion (RM44.50 billion) compared to US$12.02 billion (RM46.80 billion), down 4.9% from 2015; Members of the Association of Southeast Asian Nations (ASEAN) have established the ASEAN Free Trade Area. The ASEAN Free Trade Area (AFTA) is a trading bloc agreement to support local production in all ASEAN countries. The main objective of AFTA is to increase ASEAN`s competitive advantage as a production base in the global market. The secondary objective is to attract more foreign direct investment to ASEAN.
The common effective preferential tariff and the elimination of tariff and non-tariff barriers to trade among ASEAN members are the main instruments for achieving its objectives. In 2018, ASEAN together represents a market with a GDP of more than $3.1 trillion and a population of 655 million people. The ASEAN members are: Brunei, Burma, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand and Vietnam. Through ASEAN, Malaysia has concluded regional free trade agreements with China, Japan, Korea, India, Australia and New Zealand and also participates in the ASEAN Merchandise Trade Agreement (ATIGA). Other trade agreements concluded are: Preferential Trade System-Organization of the Islamic Conference (GST-OIC) and Development of Eight (D-8) Preferential Tariff Agreements (PTAs). The free trade agreements signed until their ratification and entry into force the ASEAN-Hong Kong Free Trade Agreements (AHKFTA) were signed in November 2017 and are expected to enter into force in 2019. The Trans-Pacific Partnership Agreement (SPLA) was signed on February 4, 2016. Since the official withdrawal of the United States from the TPP in 2017, the other TPP countries have concluded the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The CPTPP was signed on March 8, 2018 by the 11 participating countries – Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The signing of the agreement means that these countries will begin the process of domestic ratification to bring the agreement into force. The CPTPP was adopted by these countries on September 30. Promulgated in December 2018: Australia, Canada, Japan, Mexico, New Zealand, Singapore and Vietnam on January 14, 2019.
The CPTPP will enter into force for Brunei Darussalam, Chile, Malaysia and Peru 60 days after the completion of their respective ratification processes. In the case of Malaysia, the new government is still evaluating the agreement and has not yet set a concrete date for ratification. Free Trade Agreements currently under negotiation: Describes the trade agreements in which this country is involved. Contains resources where U.S. companies can get information on how to use these agreements. .