Spurring Exports In The New Norm MATRADE Core Purpose 75 01 02 03 04 05 FREE TRADE AGREEMENTS Free Trade Agreements (FTA) are signed by Malaysia as one of the best ways to provide better market access for Malaysian products and services. An FTA is an agreement between two or more countries in which the countries involved are given preferential access to the market. Each FTA partner country will offer concessions, incentives or facilities to each other for the purposes of trade, investment, service provision and economic cooperation. To date, Malaysia has signed 16 FTAs and implemented 14. Seven of them are bilateral agreements with Australia, Chile, India, Japan, New Zealand, Pakistan and Turkey. All bilateral agreements have been enforced. Malaysia has also signed seven regional FTAs through the Association of Southeast Asian Nations (ASEAN) with Australia, China, Hong Kong SAR, Japan, India, New Zealand and the Republic of Korea (ROK). Malaysia also signed the Comprehensive and Progressive Agreement for TransPacific Partnership (CPTPP) in 2018 and the Regional Comprehensive Economic Partnership (RCEP) in 2020, but both agreements are not yet in force. RCEP involves ASEAN countries and five trading partners namely Australia, China, Japan, ROK and New Zealand. FTAs allow Malaysian exporters to gain preferential access to markets of countries involved. It also enhances competitiveness of Malaysian exporters through cost savings from the reduction or elimination of tariffs and non-tariff barriers as well as liberalisation in trade rules and procedures. For the services sector, FTAs provide better market access for various commercial and professional services and also facilitates Malaysian investors to invest in FTA partner countries. Being aware of the privileges and facilities offered through FTAs, MATRADE continually works with the Ministry of International Trade and Industry (MITI) to ensure that Malaysian exporters have complete information on FTA benefits. In 2020, Malaysia's trade with FTA partners accounted for 66.7% (RM1.190 trillion) of the country's total trade and 68.0% (RM669.40 billion) of total exports. Malaysia's trade with FTA partners registered 66.7% of the country's total trade (RM1.190 trillion) 68.0% of the country's total exports (RM669.40 billion)
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