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Ensuring More Secure Trading Environment

In 2004, the United Nations (UN) Security Council passed a resolution which requested member countries to establish an export control system for the purpose of non-proliferation of weapons of mass destruction.

In other words, member states were requested to control exports of strategic items which may be used for terrorist activities.
In line with the adoption of the UN Resolution in 2004, Malaysia worked on a comprehensive law to govern the export control of strategic items. This was a crucial move given the nature of the country's open economy.

The government's efforts to secure trade against terrorist infiltration culminated in the Strategic Trade Act 2010 (STA) which was passed by Parliament in April 2010 and received Royal Assent in June 2010. The Ministry of International Trade and Industry (Miti) is the custodian of this Act.

The purpose of the STA is to provide control over the export, transhipment, transit and brokering of strategic items, including arms and related materials, as well as other activities that may facilitate design, development and production of weapons of mass destruction and their delivery systems.

The Act's ultimate goal is to provide the international trading community with the assurance that Malaysia is a desirable trading partner, whose open system has a sound mechanism to protect against security compromises.

The Act also works to deny terrorists' access to our advanced export logistics and capabilities, while protecting local players who carry out legal and beneficial trade activities and may be vulnerable to exploitation by terrorists.

Hence, the STA represents a multi-faceted approach towards securing the continued and healthy development of our international trade and, in turn, Malaysia's economic prosperity.

To implement the STA, Miti has set up just established the Strategic Trade Secretariat, led by a controller. The implementation of this law will involve many other ministries and agencies, from licensing, enforcement and prosecution. The related laws under the STA include:
  • Atomic Energy Licensing Act 1984 (Act 304);
  • Chemical Weapons Convention Act 2005 (Act 641);
  • Prevention and Control of Infectious Diseases Act 1988 (Act 342);
  • Animals Act 1953 (Act 647);
  • Pesticides Act 1974 (Act 149);
  • Plant Quarantine Act 1976 (Act 167);
  • Protection of New Plant Varieties Act 2004 (Act 634); and
  • Customs Act 1967 (Act 235).

The STA will be implemented through guidelines and procedures that will detail the mechanism of exports of strategic items in Malaysia. The regulations are being finalised for implementation by October. The STA is consistent with Malaysia's national security and international obligations. In implementing this Act, Malaysia will ensure its strict enforcement and penalties. However, Miti will also ensure that the implementation will not hinder export activities in the country.

While enforcement is required, the spirit is to facilitate legitimate trade.

The country has continuously demonstrated its commitment towards fostering mutually beneficial trading partnerships.
In recent years, it has joined hands with various nations to remain informed on the issue of strategic trade controls. For example, Malaysia has collaborated with the US, Germany and Japan in working towards establishing more effective export controls.

These efforts promote Malaysia's solidarity with legitimate exporters in the international community against the proliferation of terrorist-related goods.
At the same time, the measures demonstrate to illicit traders that this country cannot be taken advantage of as a destination to channel such goods.


Other benefits to Malaysia by having this law include:

  • Enhancing Malaysia's image and building confidence among foreign investors to invest in Malaysia;
  • Facilitating and managing the exports of high technology goods and components from Malaysia to other countries;
  • Protecting Malaysia and Malaysian exporters from being exploited by proliferators and those that profit from their
  • activities without compromising legitimate trade in the strategic items;
  • Promoting Malaysia as a safe country to trade with; and
  • Enabling Malaysia's contribution in maintaining the international peace and security by combating the proliferation of weapons of mass destruction.

Industry associations and business councils, especially those whose members comprise exporters, should be aware of the requirements and ensure compliance with the Act. To this end, the Strategic Trade Secretariat is undertaking outreach programmes to promote awareness.

Feedback and comments on this subject can be sent to webmiti@miti.gov.my.
The writer is International Trade and Industry Ministry Secretary General.


By Tan Sri Abdul Rahman Mamat


Last Updated 2015-07-21 09:41:07 by vox vox

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