U.S. Says Malaysia Trade Pact at Risk Without Advance Next Week
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Jan. 11 (Bloomberg) — U.S. and Malaysian negotiators
meeting next week for the first formal round of free trade talks
in almost a year need to make “substantial progress or risk
delaying the pact indefinitely, a U.S. ambassador said.
“Clearly there is a time limit on how much energy both
governments can put into this, James R. Keith, the U.S. envoy
to Malaysia, said in an interview in Kuala Lumpur today. “There
is only a certain amount of time left before this administration
in the U.S. runs out of time.
Failure to conclude talks by the end of summer this year
would make it harder to achieve further progress, as U.S.
leaders prepare for presidential elections in November that will
bring in a new administration, Keith said.
Officials from the two countries seeking to bolster $52
billion of two-way trade will meet in Kuala Lumpur to begin the
sixth round of trade talks on Jan. 14, after missing a U.S.
deadline to conclude discussions last year. The last round of
negotiations was held in February last year.
“I am very hopeful that we can make it happen by next
summer, Keith, who has been in Malaysia since September, said.
“If we dont, well continue to look for another partner in the
region. Well find someone else to negotiate with.
Malaysias reluctance to open up its rice market, change
policies that benefit ethnic Malays and meet requests to
increase access to government contracts are among the issues
that have delayed the signing of a pact.
`Bottom Line
“A bottom line for us on government procurement is
transparent and reciprocal market access, Keith said. “We
have to have that. If we dont have that, then it would become a
deal stopper. Weve got some absolute requirements.
Keith said he doesnt expect to conclude talks on
government contracts next week, although U.S. negotiators will
be seeking “substantial market access in areas including
financial services.
The U.S., which started the free trade talks in June 2006,
is Malaysias No. 1 overseas market, buying almost a fifth of
the Southeast Asian nations exports.
Malaysias Trade Minister Rafidah Aziz is out of the office
and not immediately available for comment, her press secretary
said in an e-mail.
U.S. negotiators had sought to reach agreement before April
last year in order to push a deal through Congress before
President George W. Bushs trade promotion authority expired at
the end of June 2007. A trade promotion authority allows the
president to present Congress with trade agreements that it can
accept or reject, not change.
`Roll of the Dice
U.S. Assistant Trade Representative Barbara Weisel said in
July the U.S. plans to conclude a free-trade agreement with
Malaysia in the first half of this year.
“We still have time left to conclude the agreement by the
summer, Keith said today. “If we dont, its a roll of the
dice. You want to be careful about what you pass on to a new
administration.
The U.S., which hasnt signed a free-trade agreement with a
Southeast Asian country since a 2003 accord with Singapore,
signed one with South Korea on June 30. The Korean agreement is
likely to be the last such deal reached before Bush leaves
office. It joins three other accords, with Peru, Colombia and
Panama, that need to be approved by a Democratic Congress.
Malaysias total trade with the U.S. grew 6.1 percent to
170.8 billion ringgit ($52 billion) in 2006. Trade with the U.S.
accounted for 16 percent of Malaysias global trade.
An agreement would offer U.S. companies such as Microsoft
Corp. and General Electric Co. greater access to Malaysias $149
billion economy, Southeast Asias third-largest. The country is
the 10th-largest U.S. trading partner.
Sixty percent of Malaysias 26 million citizens are ethnic
Malay. An affirmative action policy introduced in 1971 gives
Malays preference in government contracts, housing, education
and jobs.
To contact the reporter on this story:
Stephanie Phang in Kuala Lumpur at at
