1. New opportunities for Malaysia and Australia resulting from MAFTA
John Fisher
First Assistant Secretary, Free Trade Agreement Division
Department of Foreign Affairs and Trade
MABC High Tea Briefing
Kuala Lumpur, 17 June 2013

2. Overview Bilateral trade and investment relationship
Malaysia-Australia FTA (MAFTA)
key outcomes for Malaysia and Australia in goods and services
additional benefits
next steps

3. Trade with Malaysia (2012) Australia’s 9th largest trading partner
two-way trade worth A$17.7 billion annually
Goods
$9.6b
Services
$1.3b
Imports from Malaysia
$10.9b
Goods
$5.1b
Services
$1.7b
Exports to Malaysia
$6.8b

4. Trade with Malaysia: Top 5
Crude petroleum
Refined petroleum
Transport services
AV/TV equipment
Computers
Top 5 imports from Malaysia
Crude petroleum
Education-related travel
Copper
Recreational travel
Nickel
Top 5 exports to Malaysia

5. Malaysia-Australia FTA (MAFTA)
Entered into force on 1 January 2013
“AANZFTA-Plus”
Key features
tariffs and quotas eliminated or reduced
increased market access, including options for majority ownership in selected services sectors
Australian Minister for Trade and Competitiveness, Craig Emerson, and Malaysia’s Minister for Trade and Industry, Mustapa Mohamed

6. MAFTA: Key outcomes – Goods
Key benefit for Malaysia:
100 per cent tariff elimination from 1 Jan 2013
Key benefits for Australia:
automotives and automotive parts
iron and steel
processed foods, plastics, chemicals and a range of manufactured products
milk, wine and rice
Business-friendly rules of origin provisions 6

7. Case study: Milk industry
Harvey Fresh Milk
produces fresh juice, dairy and wine products
local and foreign markets
exports one million litres of fresh milk to Malaysia
F&N Dairies Sdn. Bhd
major manufacturer and marketer of milk and juice in Malaysia
imports 100 per cent Australian fresh milk
Under MAFTA:
Malaysia will increase the volume of its tariff-free quota of liquid milk from Australia each year
additional capacity to AANZFTA commitments

8. Case study: BlueScope Steel Malaysia
Leading supplier of premium metallic coated and painted steel building products
entered Malaysia in 1996
seven manufacturing plants in Malaysia, Singapore and Brunei
Supplier for key projects:
Legoland, KL International Airport 2 Integrated Complex, Pinewood Malaysia Studios
Under MAFTA:
tariffs on 96.4 percent of iron and steel imported from Australia will be eliminated by 2016 (100 per cent by 2020)

9. MAFTA: Key outcomes – Services
Key benefits for Malaysia
‘AANZFTA Plus’ commitments in:
private hospitals, integrated engineering, research and development, technical testing and analysis and pre-erection work at construction sites
Key benefits for Australia
majority ownership commitments in:
higher education, direct insurance and investment banking, telecommunications, selected professional services

10. MAFTA: Services commitments
Source: ‘Services Commitments in Preferential Trade Agreements: An Expanded Dataset’, Roy, 2011 (WTO Staff Working Paper ERSD )

11. Case study: University sector
Monash, Swinburne and Curtin Universities
campuses in Malaysia
Under MAFTA:
Australian higher education providers can own up to 70 per cent equity in local campuses
increase to 100 per cent by 2015
Malaysia raised the quota of Australian lecturers per institution
20 to 30 per cent

12. MAFTA: Additional Benefits
Investment
stronger legal protections
increased foreign investment review screening threshold for Malaysian investors in services
Business-friendly outcomes
mutual recognition of qualifications and licensing for professionals
stronger protection of trademarks and copyright
facilitation of electronic commerce
Economic cooperation 12

13. Case study: Automotive industry
Malaysia Automotive Institute (MAI) and Australia's Cooperative Research Centre for Advanced Automotive Technology (Auto CRC)
AutoCRC Vehicle Electrification program:
collaboration between University of Wollongong, University of Technology Sydney and CSIRO and MAI
Under MAFTA:
established an Automotive Industry Dialogue to provide a forum for enhanced cooperation between Malaysian and Australian automotive industries

14. MAFTA: Next steps In-built agenda
framework for ongoing review and expansion of commitments
negotiations on binding investment commitments
Complements existing and proposed regional agreements
ASEAN-Australia-New Zealand FTA
Regional Comprehensive Economic Partnership
Trans-Pacific Partnership 14

15. Conclusion MAFTA offers substantial opportunities for business
encourage you to take advantage!
Further information: 15