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Malaysia, China should capitalise on RCEP to strengthen ties

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Deputy Minister Datuk Lim Ban Hong said China is welcomed to leverage Malaysia’s position as the ideal gateway for Chinese enterprises to penetrate the Asean market and boost trade activities through RCEP, particularly in high-tech manufacturing projects and emerging industries.

KUALA LUMPUR: Malaysia and China should capitalise on the New International Land-Sea Trade Corridor along with the Regional Comprehensive Economic Partnership (RCEP) to strengthen the existing trade and investment ties, says the Ministry of International Trade and Industry.

Deputy Minister Datuk Lim Ban Hong said China is welcomed to leverage Malaysia’s position as the ideal gateway for Chinese enterprises to penetrate the Asean market and boost trade activities through RCEP, particularly in high-tech manufacturing projects and emerging industries, Bernama reported.

“The inception and implementation of RCEP will further unleash the potential for trade in goods between Malaysia and China, and help transform and upgrade regional industries as well as injecting new vitality into regional economic development.

“As Malaysia is strategically located at the heart of South-East Asia, we are well positioned to serve as a gateway to the Asean region. Companies from Malaysia and China must work closely as part of the RCEP supply chain. This is crucial in the time of global recession and supply chain disruptions,” he said.

In his speech at the Malaysia-China (Chongqing) Investment Forum 2022 themed Explore RCEP Opportunities and Development in Strategic Sectors yesterday, Lim cited Asian Development Bank’s study that the RCEP will increase the member economies’ incomes by 0.6% by 2030, adding US$245bil (RM1.1 trillion) annually to regional income and 2.8 million jobs to regional employment.

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Besides, the RCEP has also introduced a unified eCommerce rules and trade facilitation provisions, which will further expand the scope of cooperation between Malaysia and China in areas such as cross-border eCommerce, digital transformation of traditional enterprises and digital infrastructure, he said.

He added that the Boston Consulting Group’s latest analysis found that battery-powered electric vehicles (EVs) will amount to 20% of global sales by 2025 and 59% in 2035.

As such, he welcomed EV companies from Chongqing to explore public-private partnerships to jointly develop EV charging infrastructures and manufacturing in Malaysia.

Meanwhile, Lim said Chongqing is one of the top three bases in China for automotive manufacturing which has led to high demand for automotive parts, and Malaysia is well positioned to continue to serve as the sourcing partner to meet the demand as it has been the largest import source country of chassis fitted with engines for tractors and motor vehicles to China in 2020 and the second largest import source in 2021.

He said the industry remains an important and strategic segment of Malaysia’s manufacturing sector, contributing 4% to Malaysia’s gross domestic product and continues to be the third largest automotive market in Asean.

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