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Press release:
Economy gains from openness to trade and investment and prudent management |
1. The fourth Trade Policy Review of Malaysia has enabled us to
improve our understanding of the developments in its trade and related
policies since its previous Review in 2001, and of the challenges it
now faces. The Government and Secretariat reports, together with
Malaysia's responses to Members' questions, have contributed to the
transparency of Malaysia's trade policies and practices. Our
discussion has clearly benefited from the active participation of the
Malaysian delegation as well as from the insightful contribution of
our discussant and the numerous interventions by Members.
2. Members welcomed the recovery of the Malaysian economy after the
Asian financial crisis and noted that Malaysia has pursued policies
aimed at strengthening and diversifying its economy, liberalizing
trade and investment, building knowledge-based industries and
services, and carrying out structural reforms in key areas, including
the financial sector. Exports have increased significantly, supporting
real GDP growth and both unemployment and inflation have remained low.
Members encouraged Malaysia to continue efforts to ensure that it
stays on the path of development and reforms and thereby strengthens
its resilience to external shocks.
3. Members appreciated the constructive role played by Malaysia in the
Doha Development Agenda negotiations and its varied efforts to achieve
progress and consensus. They also noted that, at the same time,
Malaysia had been intensifying its bilateral free-trade negotiations
with other WTO Members, whether on its own or as part of ASEAN.
4. Members applauded successive steps taken by Malaysia to reduce its
average applied MFN tariff rate. However, they expressed some concern
that over one-third of tariff lines are not bound, and gaps between
bound and applied rates are large, thereby imparting a degree of
unpredictability to the tariff. Some Members pointed out that high
tariffs, combined with non-tariff measures, limited trade
opportunities in significant sectors, such as steel, automobiles and
automotive components. In the automobile sector, particular concerns
were raised concerning the approved permit system affecting imports
and the rebate on excise taxes available to local manufacturers. Some
Members noted that Malaysia had become a more active user of
anti-dumping measures and was planning to develop safeguard
legislation. Members acknowledged Malaysia's efforts to align its
national standards with international ones and urged Malaysia to
expedite the harmonization of its remaining standards. Clarification
was also sought with respect to the array of incentive programmes
provided by the Government to many industrial companies as well as to
the status of draft competition legislation. Some Members were
interested to know of any government plans to make government
procurement more open and transparent. Members appreciated that
Malaysia has taken steps to strengthen its intellectual property
regime and encouraged Malaysia to continue its efforts to improve
enforcement.
5. On sectoral issues, Members noted that services are the largest
component of Malaysia's economy and one of the key drivers of economic
growth, although progress in liberalizing the services sector lagged
behind agriculture and manufacturing. Some Members encouraged Malaysia
to progressively liberalize its services sectors and to reduce or
remove restrictions on foreign ownership, notably through improving
its commitments in the context of the current services negotiations.
6. This successfully concludes our Review of Malaysia. Members
expressed their appreciation for the oral and written responses to
their questions from the Malaysian delegation and looked forward to
receiving the few still outstanding. Members clearly value Malaysia's
efforts to continue to liberalize its trade regime and trade-related
policies, to encourage both outward and inward investment. They also
appreciate Malaysia's aim of achieving developed country status by
2020. Given the contribution of the multilateral trading system to the
achievement of this goal, I am sure that Members can look forward to
Malaysia's continued active support for the WTO and the ongoing
negotiations. |
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