Malaysia and Japan yesterday agreed to set up a free trade area (FTA) as part of a comprehensive economic relationship after resolving the last remaining differences in emergency, high-level talks.
"We have now finalized everything," International Trade and Industry Minister Rafidah Aziz told reporters after talks with Japanese Trade Minister Shoichi Nakagawa who arrived earlier yesterday for last-ditch efforts to salvage deadlocked negotiations on a planned free trade area.
"It will be a comprehensive economic framework agreement covering all the areas that we feel we would like to cover," Rafidah said.
PHOTO: AP
Talks between Japan and Malaysia began in Kuala Lumpur on Tuesday but had failed to produce a consensus on tariffs for industrial products, especially in the sensitive auto sector and steel industries of Malaysia, which Japan says is excessively protectionist.
"I have been saying that it is the final stretch that is the most difficult," Nakagawa said. The "trust and confidence" between the two countries had led to this "win-win relationship."
secret compromises
He and Rafidah refused to divulge the details of the compromises made in the auto and steel tariff structures with Nakagawa describing it as "a national secret."
Rafidah said that the comprehensive economic relationship will contain elements of the free trade area, which will be formally launched in December.
"What we have decided today will become the basis for an agreement in principle" that will be announced when Malaysian Prime Minister Abdullah Ahmad Badawi visits Tokyo on May 25-26 for a bilateral visit.
"It covers all areas -- goods, services, even agriculture and economic cooperation," she said.
Since launching the FTA talks in January last year, the two countries have reached a basic accord on agricultural and marine products. But outstanding issues remain, including Malaysia's tentative pledge to fully eliminate tariffs on imported vehicles by 2015. Japan wants an earlier deadline.
Malaysia imposes high import and excise duties on imported cars to protect its national Proton and Perodua cars from competition. The two carmakers jointly control 74 percent of the auto market in Malaysia, Southeast Asia's biggest passenger car market. Tariffs have recently been lowered for cars produced in Southeast Asian countries but other countries still face high barriers.
Japan also wants Malaysia to abolish tariffs on steel products used for vehicles and household appliances. It quoted unidentified Japanese government sources as saying that Malaysia is considering an immediate removal of tariffs for some car models that do not compete with Proton and Perodua.
Tariff variations
Rafidah said the FTA will contain some "early harvest programs," meaning a list of goods on which the tariff abolition and reduction will come into force immediately after the deal is signed in December. Other items will see the benefits of the FTA gradually.
"The mechanism for tariff cutting, tariff abolishment in terms of FTA will start as and when it is scheduled to start."
"Both sides are very happy ... As of now it is done. We are just going to shake hands afterward," she said.
FREEDOM OF NAVIGATION: The UK would continue to reinforce ties with Taiwan ‘in a wide range of areas’ as a part of a ‘strong unofficial relationship,’ a paper said The UK plans to conduct more freedom of navigation operations in the Taiwan Strait and the South China Sea, British Secretary of State for Foreign, Commonwealth and Development Affairs David Lammy told the British House of Commons on Tuesday. British Member of Parliament Desmond Swayne said that the Royal Navy’s HMS Spey had passed through the Taiwan Strait “in pursuit of vital international freedom of navigation in the South China Sea.” Swayne asked Lammy whether he agreed that it was “proper and lawful” to do so, and if the UK would continue to carry out similar operations. Lammy replied “yes” to both questions. The
‘OF COURSE A COUNTRY’: The president outlined that Taiwan has all the necessary features of a nation, including citizens, land, government and sovereignty President William Lai (賴清德) discussed the meaning of “nation” during a speech in New Taipei City last night, emphasizing that Taiwan is a country as he condemned China’s misinterpretation of UN Resolution 2758. The speech was the first in a series of 10 that Lai is scheduled to give across Taiwan. It is the responsibility of Taiwanese citizens to stand united to defend their national sovereignty, democracy, liberty, way of life and the future of the next generation, Lai said. This is the most important legacy the people of this era could pass on to future generations, he said. Lai went on to discuss
AMENDMENT: Climate change is expected to increase the frequency of high-temperature days, affecting economic productivity and public health, experts said The Central Weather Administration (CWA) is considering amending the Meteorological Act (氣象法) to classify “high temperatures” as “hazardous weather,” providing a legal basis for work or school closures due to extreme heat. CWA Administrator Lu Kuo-chen (呂國臣) yesterday said the agency plans to submit the proposed amendments to the Executive Yuan for review in the fourth quarter this year. The CWA has been monitoring high-temperature trends for an extended period, and the agency contributes scientific data to the recently established High Temperature Response Alliance led by the Ministry of Environment, Lu said. The data include temperature, humidity, radiation intensity and ambient wind,
SECOND SPEECH: All political parties should work together to defend democracy, protect Taiwan and resist the CCP, despite their differences, the president said President William Lai (賴清德) yesterday discussed how pro-Taiwan and pro-Republic of China (ROC) groups can agree to maintain solidarity on the issue of protecting Taiwan and resisting the Chinese Communist Party (CCP). The talk, delivered last night at Taoyuan’s Hakka Youth Association, was the second in a series of 10 that Lai is scheduled to give across Taiwan. Citing Taiwanese democracy pioneer Chiang Wei-shui’s (蔣渭水) slogan that solidarity brings strength, Lai said it was a call for political parties to find consensus amid disagreements on behalf of bettering the nation. All political parties should work together to defend democracy, protect Taiwan and resist