WASHINGTON (Reuters) – Malaysia sees U.S. President Joe Biden’s proposed Indo-Pacific economic bloc as a welcome move, but sees greater immediate opportunity in selling its access to a China-led trade pact to attract investment from global companies, said the Malaysian trade minister. Friday.
The Indo-Pacific Economic Framework (IPEF) proposed by the Biden administration aims to provide a US-led platform to negotiate common regional standards regarding digital trade and data flows, labor standards, carbon emission reductions and governance. But to the chagrin of some countries and business groups, it will not reduce tariffs between members or include traditional market access improvements.
Azmin Ali, Malaysia’s minister for international trade and industry, told Reuters in an interview that the recently launched Regional Comprehensive Economic Partnership (RCEP) gives businesses the opportunity to use Malaysia as a hub to access a market. comprising a third of the world‘s population and a third of the production of the world’s GDP.
“That’s almost 2.3 billion people under RCEP,” Azmin said. “Once again, we would like to invite these big companies to come to Malaysia and use Malaysia as a gateway to enter greater market access and also to benefit from lower tariffs in terms of our export products.
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The 15-member RCEP bloc includes China, the world’s second-largest economy, and Japan, the third-largest, along with Vietnam and Australia.
Malaysia also touts access to another regional trading bloc, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which includes a number of RCEP countries other than China and adds Canada, Mexico, Peru and Chile.
The IPEF plan was a key talking point at an Association of Southeast Asian Nations (ASEAN) leaders’ summit in Washington, although it is not expected to be officially announced. launched before Biden visits Japan next week.
Malaysian Prime Minister Ismail Sabri Yaakob on Thursday called on Washington to adopt a “more active” trade and investment agenda with ASEAN countries.
Azmin said IPEF ‘is not TPP 2.0’, referring to the pan-Pacific trade deal that former US President Donald Trump left in 2017, but said it was the first ever. formal economic engagement between the United States.
“It’s a good start for us to engage on various issues, including non-traditional items like environment, climate change, labor practices, governance,” Azmin said.
Malaysia has yet to decide which of the so-called IPEF pillars to join, he added. Vietnam’s prime minister also said on Wednesday that more time is needed to study IPEF.
To make the project more attractive to Asian countries without reducing U.S. import tariffs, Azmin said he suggested to U.S. Commerce Secretary Gina Raimondo that IPEF include some provisions to provide more assistance. technical and capacity building to member countries to help bridge the gaps between their different levels. of development.
This would help less-developed countries comply with international labor and environmental standards, he added.
(Reporting by David Lawder; Editing by Marguerita Choy)
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