Implementation of CPTPP will elevate Malaysia’s competitiveness in the global arena — MPA
27 Oct 2022
The implementation of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will place Malaysia in a strategic position as well as elevating the country’s competitiveness in the global arena.
In a statement today, the Malaysian Petrochemicals Association (MPA) president Akbar Md Thayoob said the association commended the Ministry of International Trade and Industry’s (MITI) efforts in completing the domestic procedures following the mandate received from the cabinet.
He said MITI has enabled the final submission of Malaysia’s Instrument of Ratification (IOR) for the CPTPP with the depositary in New Zealand to be executed on Sept 30, 2022.
“The CPTPP Agreement has been ratified and implemented in stages since Dec 2018 by Australia, Canada, Japan, Mexico, New Zealand, Singapore, Vietnam and Peru.
“It will broaden Malaysia’s access to new markets such as Canada, Mexico and Peru, which are not covered by any existing Free Trade Agreement (FTA),” he said.
He said Malaysian exporters would enjoy duty-free treatment on products such as automotive parts and components, plastics products, surgical gloves, rubber products, textiles and clothing, cocoa products and food items.
Akbar said it is also encouraging to note that the UK and People’s Republic of China (PRC), Chinese Taipei, Ecuador and Costa Rica have also officially applied to join the CPTPP, allowing Malaysian exporters to gain wider and deeper market access opportunities.
He said the cost-benefit analysis (CBA) done on the CPTPP projected that the total trade from Malaysia is expected to increase to US$655.9 billion (US$1=RM4.71) in 2030.
On the other hand, he said exports are projected to reach US$354.7 billion in the same year with trade balance remaining in strong surplus at 8.5 per cent of gross domestic product (GDP) for 2030.
He said under the CPTPP, almost 100 per cent of Malaysian exports to all CPTPP countries would enjoy duty-free treatment by Jan 1, 2033.
Akbar said as soon as the CPTPP enters into force for Malaysia, all Malaysia’s exports to Australia and Singapore markets would be without any duties.
He said all Malaysian products exported to New Zealand and Canada would be duty-free in 2024 and 2029, respectively.
Currently, he said duties on key Malaysian exports to Canada and Mexico ranges between 15 to 30 per cent.
“In essence, the CPTPP will co-exist with all other FTAs and will place Malaysia in a strategic position, elevating our competitiveness in the global arena,” he added.