KUALA LUMPUR: Malaysia and Australia are looking to come together on a new economic deal that would see the free flowing of trade between the two countries, especially in the automotive industry. It comes on the heels of a potential asylum seekers deal that appears to be stagnating, but officials are hopeful that trade between the two countries can boost relations. According to the Malaysian Automotive Institute (MAI) Chief Executive Officer Madani Sahari besides the Malaysia-Australia Free Trade Agreement (Mafta), both countries “had also inked an economic and technology cooperation agreement in August last year.” For local auto dealers, the announcement of a potential deal has them excited. One dealer in Kuala Lumpur told Bikyanews.com that “this agreement could help us get more cars in showrooms and make more options available to Malaysians.” The trade deal seeks to have both countries complemented, with Australia leveraging its technological capacity that aims to bring Malaysia onto the international stage and act as a sort of gateway for Australian business into the region. “The agreement would encompass three key areas of the industry technology, human capital and supply chain. MAI would be a window to connect to Austalia's Automotive Cooperative Research Centre (AutoCRC) to tap into its technical knowledge and skills," said Sahari. Since January, Sahari said that “five projects with a development value of RM15mil had been initiated. All are 50% funded by the Australian government, as will be future projects.” The collaboration with AutoCRC will be for five years but the parties involved are already deliberating on extending it for another five years. “These projects involve the development of several manufacturing capabilities like tooling, pattern testing and fixture design. “All these are to enhance the local supply chain and also the vendor's produce and process design," he added. Sahari said although Australia's total industry volume was about 1.1 million a year, its domestic production was just 180,000 units. In contrast, Malaysia's total industry production last year stood at 569,620 units, for both passenger and commercial vehicles. Under Mafta, there will be zero import duties on auto components sent to Australia, while the import duties on shipments to Malaysia would be capped at 30%. “Although it may look one-sided for now, the duties will be gradually reduced to zero to five percent by 2016," Sahari said. BN
