KUALA LUMPUR (July 28): The Indo-Pacific Economic Framework (IPEF), in which Malaysia participates, can be an instrument that helps in discussing and reducing the impact of withhold release orders (WROs) imposed by the US on Malaysian products. 

At this time, IPEF membership consists of 14 countries, namely the US, Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam.

Senior International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said that Malaysia at this point does not have a clear structure to establish economic cooperation with the US.

“That is why we are dealing with the issue of WROs, where they have issued six WROs against local companies, and this will restrict the export of Malaysian products and services to the US.

“I believe that with the existence of this new instrument, we can establish cooperation, discussion, and engagement with the US in order to reduce the impact of WROs and also issues related to the matter,” he said in Parliament on Thursday (July 28).

Azmin noted that the economic framework is seen as a suitable platform for Malaysia and the US to discuss various trade-related matters, such as sharing efforts to improve Malaysia's position in the Trafficking in Persons Report, besides fostering closer cooperation with the US government to improve Malaysia's ability to comply with the latest international regulations and standards, thus further reducing the incidence of WROs against Malaysian companies.

Azmin was responding to questions by both Bukit Bendera Member of Parliament (MP) Wong Hon Wai and Tebrau MP Steven Choong Shiau Yoon, who wanted to know the latest position of Malaysia's participation in the IPEF, how the country can balance its international trade with other major trading partners like China and where Malaysia has joined the Regional Comprehensive Economic Partnership (RCEP). 

Malaysia on Wednesday proposed that partners in the IPEF collaborate to set up a centre of excellence to provide a cohesive and structured platform to facilitate seamless and dynamic exchanges of ideas and recommendations.

In a statement issued at the IPEF ministerial meeting, Azmin said the move will bring together experts in areas such as supply chain resiliency, energy sector transformation and decarbonisation of emission-intensive industries.

Meanwhile, Azmin in the Dewan Rakyat on Thursday explained that the IPEF is not a traditional free trade agreement (FTA), but rather an instrument or platform that can help Malaysia strengthen its economic relations with the US and member countries in the Indo-Pacific region. 

As such, he said Malaysia had proposed for the establishment of the centre, given that the IPEF does not have the element of market access, which needs to be given attention by IPEF member countries, especially the US. 

“[This is] to focus on the elements of capacity building and technical assistance, as IPEF member nations come from various levels of development.

“The level of development of the member countries is different, so with this element of technical assistance and also capacity building, we can reduce or close the gaps in development between the countries concerned,” he said.

Azmin also viewed that Malaysia needs to deepen its economic integration, especially in today's increasingly challenging situation. 

“We can no longer act alone. Malaysia as a trading country needs to establish economic relations with various parties and many countries, including China, the European Union, and the US.

“Before we took a stand to join the IPEF, Malaysia had already agreed to join the RCEP, and we have ratified the RCEP agreement, where China is a member country. This proves Malaysia's commitment to not only continuing but strengthening trade and investment with China.

“Secondly, China has also submitted an application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Malaysia signed this agreement in 2018, and is now in the process of ratifying the agreement. So, this (the IPEF) is a new platform, even though it is not an FTA,” he said. 

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