Thursday March 9, 2006
US envoy says planned FTA will boost Malaysia's profile
KUALA LUMPUR, Malaysia - A free trade agreement with the United States, expected to be concluded by next year, will raise Malaysia's profile with other foreign investors and increase their confidence in the local market, the U.S. ambassador said Thursday.
Ambassador Christopher LaFleur said the U.S. hopes to wrap up talks for an FTA - announced in Washington on Wednesday - by the end of 2006, and send it to Congress for approval before July 1, 2007. That's the expiration date for the Bush administration's authority to negotiate trade deals that require Congress to approve or reject them without adding any amendments.
He said there are five major benefits from the FTA for Malaysia, including raising the nation's profile.
"There is tough global competition for foreign investments these days,'' LaFleur said.
"The special relationship established with the U.S. through an FTA would help Malaysia stand out from the crowd.''
LaFleur said the U.S. topped the list of foreign investors in Malaysia, with US$1.4 billion (euro1.2 billion) worth of approved investment projects in 2005, mainly from companies already present in Malaysia.
"An FTA will make such investments and new investments that much more likely,'' he said.
Malaysia is America's 10th largest trading partner with US$44 billion (euro36.9 billion) in two-way trade.
Another benefit of the increased trade and investment is that it would accelerate Malaysia's economic growth and job creation, LaFleur said, adding that employment in exporting industries has higher productivity and wages than those in domestic industries.
Malaysian consumers will also benefit by getting access to a wider variety of American products and lower prices, while factories that rely on U.S. inputs would also see a fall in their costs, increasing their productivity and competitiveness, he said.
LaFleur reiterated the U.S. is committed to moving the FTA negotiations "on a fast-track.''
"We will need to work very hard with a great deal of flexibility and understanding on both sides, to complete such a complex project in such a limited span of time,'' he said.
"But our negotiators have a good understanding of the task ahead of them, as does the national leadership on both sides.''
Malaysia will join a list of 11 other countries with which Washington is currently negotiating free trade deals.
The Bush administration announced last month it also plans to launch free trade negotiations with South Korea. - AP
US will launch free trade talks with Malaysia
WASHINGTON (AP) - The United States and Malaysia announced Wednesday that they have agreed to begin negotiating a free trade deal to eliminate trade barriers between the two nations.
The decision was announced at a crowded Capitol Hill news conference attended by lawmakers from both political parties, marking an effort by the administration to build bipartisan support for its trade policies at a time when the country is running record trade deficits.
By selecting Malaysia for free trade negotiations, the administration chose a country that is already America's 10th largest trading partner with US$44 billion (euro36.9 billion) in two-way trade.
The administration announced last month that it planned to launch free trade negotiations with South Korea and free trade talks with Thailand, another economic power in the region, are already under way.
"Malaysia has been at the forefront of the economic dynamism transforming Asia in recent years,'' U.S. Trade Representative Rob Portman said at the news conference.
"Malaysia's rapidly growing economy will help generate meaningful export opportunities for our workers, service providers and farmers.''
Portman said he believed the negotiations with Malaysia and South Korea could be completed by the end of the year.
He said the administration also expected to resume talks with Thailand, which have been suspended until after the country's current election campaign is completed.
Malaysian Minister of Trade Rafidah Aziz said that she expected no major roadblocks to completing a free trade agreement with the United States, which she said enjoys broad support in her country.
"We in Malaysia believe this is a very strategic agreement,'' she said. "There is no opposition.''
To show support for the deal, the announcement ceremony was attended by 12 members of the House of Representatives - seven Republican lawmakers and five Democrats - and two Republican senators as well as a number of business groups that have been pushing for the negotiations.
In Congress, however, Democratic Rep. Brad Sherman said at a House hearing on Asia that he hoped the Bush administration would not present a free trade agreement with Malaysia to the House until that country has changed its position toward Israel.
Assistant Secretary of State Christopher Hill indicated that Malaysia participates in the Arab-organized boycott of the Jewish state.
Sherman said he was disappointed that the announcement of free trade talks was made before Malaysia changed its official position on Israel.
"Coming on the heels of last month's announcement of (free trade) talks with Korea, U.S. manufacturers are now hopeful that our exports to the Asian market will benefit from a solid one-two punch,'' said former Michigan Gov. John Engler, who is now president of the National Association of Manufacturers.
The talks with both South Korea and Malaysia cannot begin until the Bush administration has completed a 90-day consultation period with Congress.
The administration is rushing to complete as many free trade agreements as it can before the July 2007 expiration of its authority to negotiate trade deals under special procedures requiring Congress to expedite its consideration of the deals.
A free trade deal with South Korea would mark the biggest such deal the United States has struck since it created the North American Free Trade Area linking the United States, Canada and Mexico in 1993.
An agreement with Malaysia would also be significant because it would link the United States with another fast-growing Asian economy.
Approval of deals with both South Korea and Malaysia would likely face stiff opposition in Congress, where critics contend that the administration's free trade policies have opened American workers to unfair competition from low-wage countries, contributing to the loss of nearly 3 million manufacturing jobs since mid-2000.
Bush has aggressively pursued free trade deals, pushing the number of foreign countries with such agreements from four - Canada, Mexico, Israel and Jordan - when he took office, to 17 currently.
The Jordan agreement was negotiated by the Clinton administration but did not win congressional approval until Bush became president.
Bush has reached agreements with Australia, Bahrain, Chile, Morocco, Oman, Peru, Singapore and six nations covered by the Central American Free Trade Agreement - Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua.
South Korea and Malaysia will join a list of 11 other countries with which the United States is currently negotiating free trade deals. - AP