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16/04/2003
The US-ASEAN Business Council is pressing the governments of the United States and Malaysia to sign a bilateral tax treaty with a view to paving the way for a Free Trade Agreement between the two nations.
Reports show that Malaysia is America's largest trading partner in the region, and trade between the nations stood at $34.4 billion last year. Figures show that the US currently exports more goods to Malaysia than it does to considerably larger countries such as India or Russia, and is consistently the largest foreign investor in the Malaysian economy.
Negotiations between the two nations have been ongoing for a decade, although agreement has been stalled due to issues surrounding banking secrecy. However, according to Council President Ernest Z. Bower, this concern has now been overcome, partly as result of cooperation in the international anti-terrorism initiative. "So we, in the business sector, don't see any reason not to bring our mutual taxation system into accord and into the modern and competitive era," Bower observed in a Business Coucil statement released on Tuesday.
The signature of a trade and investment framework agreement (TIFA) between the US and Malaysia would then pave the way for a Free Trade Agreement, and would underscore President Bush's Enterprise for ASEAN initiative, announced last October. For Malaysia, the importance of such a move takes on more significance in the light of the recent FTA agreement between the US and near neighbour Singapore.
Bower sought to play down talk of strained relations between the two nations concerning differing views towards the conflict in Iraq.
"In fact, the opposite is true. The United States and Malaysia are very close partners in trade, investment, education, security cooperation, and in many other areas," he declared.
