MALAYSIAN manufacturers and small- and medium-sized enterprises (SMEs) have been urged to stay competitive in international markets following the signing of the Regional Comprehensive Economic Partnership (RCEP).
The RCEP agreement, dubbed as the world’s biggest free trade agreement (FTA), has finally been signed last Sunday after going through 31 rounds of negotiations over the past eight years.
Commenting on the mega trade deal, president of the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) Tan Sri Ter Leong Yap said competition is inevitable in the global trading market place, which is now being revolutionised by digital technology and e-commerce.
“It is therefore important for Malaysian manufacturers and SMEs to focus on maintaining product quality and standards as well as branding development to stay competitive in international markets,” he said in a statement today.
According to Ter, the country’s textiles and apparels sector is expected to be dampened by low-cost competitors such as Vietnam, while the timber and timber products industry too would face competition from the participating countries.
However, he noted that at the same time, Malaysian businesses would be able to enjoy better access to quality raw materials at competitive prices under the RCEP.
As the RCEP underscores the grouping’s commitment towards the adoption of a free and fair trade to fight the rising wave of protectionism, Ter believes it will strengthen Malaysia’s position, moving forward.
He said the lowering of barriers and further streamlining of rules and regulations for trade facilitation will boost Malaysia’s trade with these countries, improve market access for goods and services, while attracting foreign companies keen on entering into a more integrated ASEAN.
Ter also believed the RCEP would enhance transparency in trade and investment, as well as facilitate the greater inclusion of ASEAN’s SMEs to global and regional supply chains.
Meanwhile, Malaysia Global Business Forum (MBGF) founding chairman Nordin Abdullah said Malaysia, which currently ranks 25th in terms of exports globally, has considerable trade links with all the signatories of the RCEP and this would give Malaysia a natural advantage.
He said out of Malaysia’s top 15 trading partners, 10 countries are signatories to the RCEP.
“Malaysian businesses should see this as an opportunity for international expansion and domestic consolidation while taking advantage of existing market share to partner with new firms, ideas and capital to grow revenue in Malaysia.
“This is the time for SMEs and government-linked companies to stand up and be counted as the rules of the game will change.
“At the same time, this means that Malaysia is now playing a more open game in the big leagues. It will be an opportunity for Malaysia to improve on the country’s competitive ranking, a catalyst to attract foreign investment from nations who are not signatories to the RCEP but looking to take advantage of the new trade arrangements,” he remarked. – Nov 17, 2020
