Malaysia-Australia Free Trade Agreement (MAFTA)
At the Eleventh Australia-Malaysia Joint Trade Committee (JTC) Meeting in Melbourne in July 2004, Australia and Malaysia agreed to conduct parallel scoping studies of a Free Trade Agreement (FTA) between the two countries, to be concluded in the first quarter of 2005. These were to form a basis for determining whether the two countries should proceed to negotiations. Australia’s bilateral relationship with Malaysia is already strong and wide-ranging. Two-way trade in goods and services between the two economies amounted to some $8.6 billion in 2003-04, which ranks Malaysia as our tenth largest trading partner. Malaysian investment in Australia has been growing strongly, with Malaysia our 13th largest source of investment. Trade and investment ties are underpinned by
…show more content…
Economic modeling carried out and suggests that the gains to Australia would be $1.9 billion in real GDP in net present value terms in the period to 2027. For Malaysia, they would be significantly higher, at an estimated RM18.3 billion (around $6.5 billion) over the same period. The modeling also suggests a significant expansion in bilateral trade, with Australia’s exports to Malaysia increasing by 5.5 per cent and Malaysia’s exports to Australia increasing by 6.3 per cent as a result of an FTA in the long run. Malaysia would benefit from a closer relationship with the fourth largest economy in the region, and one of the most strongly performing developed economies over the last decade. It would also help to protect its export markets under new preferential arrangements Australia has negotiated with Singapore, the United States and Thailand. Malaysia’s attractiveness as an investment destination would increase, particularly if it were to liberalize further its investment regime and make it more attractive to