Miti Blog

Ministry of International Trade and Industry Malaysia Official Blog

Datuk Dr Rebecca Fatima Sta Maria answers your 10 questions

Posted by admin2 on June 23, 2015 at 1:56 pm
 
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What are your thoughts on improving Malaysia’s trade position vis-a-vis major trade partners at a time when trade is more volatile? Bulbir Singh, Seremban

Make it “Easier, Faster and Cheaper” to do business in Malaysia. That’s the role of the Government trade facilitiation both within the country and across borders. It’s about reducing and eliminating bureaucratic hurdles and simplifying procedures.

Across borders, it’s about working with our trade partners to reduce and eliminate tariff and non-tariff barriers. We do this bilaterally (through our Free Trade Agreements), regionally (through our participation in Asean, and Apec) as well as multilaterally through the World Trade Organisation. Expanding Malaysia’s share of global trade is Miti’s raison d’etre. Given the uncertainty and the challenging trading environment, we have to work harder. But Miti cannot do this alone. Private sector involvement is vital to the initiatives taken to increase Malaysia’s exports of goods and services. Miti and its agencies work with industry to promote and export our goods and services. The SME Development Corp supports SMEs in the development of goods and services. The Malaysia External Trade Development Corp (Matrade) assists export-ready companies in bringing their products and services into the global market.
 
In what ways can the country take advantage of growth opportunities in the BRIC economies? Abdul Hafis, Kuala Terengganu

Engagement, Engagement, Engagement! This is done at two levels G2G, and B2B. At the G2G level we engage governments to facilitate bilateral trade and investment through trade and investment agreements and use our networks to open doors for our industry, especially SMEs. The Free Trade Agreements with India and China are good examples. We are also stepping up engagements with Brazil and Russia and going beyond the BRIC economies, to extend our reach to other emerging economies in Latin America and Africa.

At the B2B level, Miti supports the bilateral Business Councils to deepen engagement and expand networks. Examples are the Malaysia-China Business Council and the Malaysia-India Business Council. Annually, Matrade also undertakes specific investment and trade promotion missions to the BRIC economies to enhance trade and investment linkages.

In 2012, we will intensify our programmes. International buyers from these countries will also be invited to Malaysia to participate in the Malaysia International Halal Showcase and International Trade Malaysia.

One of the mandates of Miti is to plan, formulate and implement policies on industrial development, international trade and investment but where does Mida’s role come in? There seems to be an overlap or are there different aspects of the same mandate? Yvonne Tan, Petaling Jaya

Miti plans and formulates trade and investment policies to facilitate domestic and foreign investment. Mida is the investment promotion agency. Miti leads the negotiations of bilateral and regional investment agreements to promote greater investment flows by providing a legal framework that clearly sets out investment norms, protection and promotion.

Mida liaises directly with investors to ensure implementation of projects and engages with potential investors. Miti and Mida’s role while distinct, also complement each other in ensuring implementation of both foreign and domestic investments, as well as ensuring a conducive business environment for investors.

There are few Eurasians of Portuguese descent who have such prominent roles in government service. Can you share with us your experience and what you think are the ingredients for success? David Tih, Malacca

“To thine own self be true.” That’s the axiom I live by. While I am very proud of my heritage, I am above all else, Malaysian. My folks have been here for generations to the extent that it is difficult to trace our roots to any other country.I am saddened that after 54 years of nationhood we still define ourselves by race. Excelling in one’s task is less about race and all about competence.Success is about hard work, dedication and being genuine. It is about wanting to improve, to continue learning, to keep asking what can be done better. Ultimately it’s about doing your best and leaving the rest to the Lord.
 
Most economists expect trade to slow down on account of slower demand in the developed economies. China’s and India’s economies will slow down too which in turn will affect us. What are the measures being taken to mitigate this inevitable slowdown in the country’s exports? Sri Venkatasamy, Kuantan

The Eurozone crisis and the uncertain US economy will almost certainly impact emerging market economies like China and India. Despite the forecast slowdown, we will continue to intensify our export promotion in China and India, knowing that both economies are pushing for greater domestic consumption growth to compensate for lower external demand.
India is undertaking liberalisation of various sectors of its economy. Couple this with the growing middle-class and you have a compelling case for continued enagagement with the third largest economy in Asia. Our bilateral Comprehensive Economic Cooperation Agreement with India gives our business community a competitive edge compared with countries that do not yet have it.
We are also diversifying our export market by embarking on robust promotional programmes in newly emerging markets in Central Asia, Eastern Europe, East Asia and Africa. And we are targeting new sources of growth such as high value products and services including components and parts of mobile and tablet applications, medical devices, transport and machinery, ICT as well as Maintenance, Repair and Overhaul services.
 
Does the country’s industrial policy need further tweaking apart from what has been announced in the various policies/plans in order to get the economy to move up the value chain? James Chow, Petaling Jaya

These efforts aren’t new. The Second Industrial Master Plan (1996-2005) contributed to the manufacturing sector through strengthening industrial linkages, increasing value-add and enhancing productivity. In 2006, the Third Industrial Master Plan was launched to address new challenges in developing industry. This industrial policy was further enhanced with the introduction of the National Key Economic Areas (NKEAs), which identified 12 sectors that would reap the highest possible income. Under the NKEAs, a greater focus will be given to high impact projects driven by the private sector with support and incentives from the Government.
 
The recent SEA games wasn’t a good example of regional solidarity and cooperation. Are there any common goals among Asean members where trade is concerned? Wong Shan, Petaling Jaya

Asean’s economic goal is outlined in the Asean Economic Community (AEC) Blueprint. In a nutshell, it is the realisation of a competitive and dynamic region which allows for the free flow of goods, services and investment, and a freer flow of capital and skilled workers by 2015. Tariff and non-tariff barriers are to be gradually eliminated. Already, there is progress. To date more than 95% of intra-regional trade in goods is tariff-free while the services sector will be significantly liberalised by 2015. Transparent investment rules are being implemented to attract extra-regional investments and to increase intra-regional investment flows.

The focus is now on lowering transaction costs and reducing non-tariff barriers through gradual synchronisation of administrative and procedural requirements. We are also creating a common trade repository system that will increase transparency in trade rules. Customs procedures are being simplified; product standards harmonised. The region will also have a single aviation market by 2015 with the implementation of an “open skies” policy.
 
The ringgit has strengthened quite a bit against the US dollar since the depegging some years ago but is still somewhat undervalued. There are views that Bank Negara’s intervention is to make sure exports remain competitive, which means that the “value-added” in the manufacturing sector, which is constantly talked about, has some way to go. Can you share your views on this? Bernard Tan, Kuala Lumpur

An appreciating ringgit is good provided that it is in sync with economic fundamentals, and that the appreciation is in step with a corresponding strengthening of regional currencies.
As long as relative parity is maintained, Malaysia’s competitiveness will remain unchanged. Companies should not be using the exchange rate to remain competitive but rather improve their productivity and innovation.
 
We frequently read of International Trade and Industry Minister Datuk Seri Mustapa Mohamed’s travels to deepen trade ties or to hold talks on trade. Are these meetings ever fruitful? Are there any follow-ups? Rozita Ali, Seremban

Missions that the minister leads are meant to deepen economic ties and to increase Malaysia’s visibility in the international business community. In this environment we must send the message that Malaysia is open for business and is an attractive value proposition. During working visits, the minister chairs roundtable meetings with business communities; investors are briefed on investment opportunities and updated on economic initiatives implemented in the country. The minister also holds meetings with his counterparts to boost bilateral ties.
Integral to the minister’s visits is the continuous follow through on business leads.

Can you give the public a breakdown of what the ministry does with its annual budget? What is the budget for the current fiscal year ending October 2012?
Komala Sabapathy, Penang


Miti’s operational budget is based on the annual cost of operations (emoluments, utilities, rentals including that of Miti’s headquarters, state and overseas officers), promotional programmes, including trade and investment missions, and regional and international obligations (Asean, Apec, Unido, WTO).
Miti’s Development Fund is mainly for soft loans for the services sector, automation and modernisation, SME development. The budget for 2012 has yet to be approved. The total budget for 2011 was RM596mil; RM150.3mil for operational expenditure and RM445.7mil for development.


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