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According to media reports, the Australian Trade
Minister has signed a free trade agreement with
Malaysia.
As many would be aware, Australia and New Zealand already have a
free trade agreement with the ASEAN group of nations
("ASEAN FTA") which includes Malaysia.
Accordingly, the separate FTA with Malaysia
("MAFTA") will constitute an enhancement
to the existing ASEAN FTA.
According to the media report, the MAFTA intends to guarantee
tariff-free entry of 97.6% for all Australian goods, rising to 99%
by 2017. The MAFTA will only be Australia's 6th bilateral FTA
and its completion will represent the welcome completion of a deal
at the same time of slow progress on negotiations on other FTA with
China, South Korea and Japan. The hope is that it may expedite
those deals.
According to media reports, the MAFTA will have the following
additional benefits:
The services sector (including universities, schools, banks,
telecommunications companies and professional services firms) have
won increased access to the market including the ability to become
majority owners in Malaysian businesses.
Most companies will be able to own up to 70% of Malaysian firms
and Australian managers will find it easier to work in Malaysia as
their spouses and dependants are able to obtain automatic
visas.
Australia has agreed to accelerate the removal of tariffs. This
was due to happen in 2020 under the ASEAN FTA but will now happen
immediately for goods from Malaysia.
Australia has promised enhanced economic and technical
co-operation in sectors such as the automotive industry,
agriculture, tourism and clean-coal technology.
MAFTA also provides a framework for the mutual recognition of
qualifications.
Those in industry will look forward to additional details of the
MAFTA including relevant rules of origin for goods to qualify for
preferential treatment under the MAFTA, what manner of certificates
of origin (or other documentation) will be required to claim
preferential tariff treatment on goods and the provisions governing
the ability to "tranship" and "further manage"
the goods before entry into Australia.
Hunt & Hunt will be well placed to assist with the MAFTA
through resources here and through the resources of our Interlaw
(www.interlaw.org) colleague
firm Lee Hishammuddin Allen & Gledhill (www.lh-ag.com). I recently met
with them at our Interlaw regional meeting with Seoul and we look
forward to being of assistance.
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Direct trading of the Australian Dollar and the Chinese Yuan Renminbi commenced on 10 April 2013, pursuant to an agreement between the Australian Government and the People's Bank of China.
