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Date [ 2008-05-29, 14:15 ]

Korea-ASEAN FTA Seminar 2008

(Kuala Lumpur=Koreanpress) by Cecilia =  Kuala Lumpur:  On 28th May 2008, KOTRA (Korea Trade Investment Promotion Agency) and Korea Customs Service co-organized with Ministry of International Trade and Industry, Malaysia (MITI), Malaysian Industry Development Authority (MIDA), Malaysia External Trade Development Corporation (MATRADE) and National Chamber of Commerce and Industry Malaysia (NCCIM) held Korea-ASEAN FTA Seminar 2008. The seminar starts from 10:00 a.m. to 1:00 p.m. at Hotel Equatorial, Kuala Lumpur.

The Ministry of International Trade and Industry will also look at finalizing the Asean-Korea FTA for investments although it had signed in relation to goods and services. Under the services agreement, South Korean investors who set up companies for selected services in Malaysia may be allowed full equity ownership.

According to Mr. Hwang Gyu-Joon, Director General of KOTRA, they have invited 100 local buyers to attend the ‘Korea-ASEAN FTA Seminar 2008’, but the response was so good that 230 people requested to attend the seminar.

‘During this seminar, KOTRA and Korea Customs Service had arranged  specialists or professionals came to explain properly for Malaysian/Korean buyer and Korean company so that they can have better understanding and gain some profit through ASEAN-FTA. This year’s seminar is expected to give more information, more interesting, more focus and the attendees can make full use of this seminar so that trading between Korea and Malaysia will be wider,’ said Mr. Hwang.

He said through this seminar, Korean companies and Malaysian buyers can make full use of FTA. Local buyers and workers or person in-charge in the Korean companies can gain profit. KOTRA expects higher attention by using or make full use of concrete examples in FTA.

Malaysia and Korea Trade Increase

It was reported that Malaysia’s trade with Korea has almost tripled from RM16.3 billion in 1996 to RM47.9 billion in 2007. Investment from Malaysia to Korea has increased 155% from RM438 million in 2006 to RM1.1 billion in 2007. On the other hand, large Korean companies invested in Malaysia include Samsung, LG, Hyundai, Kia, Ssangyong and Daewoo.

‘Since 1980s, Korea has consistently been among the top 10 investors in the Malaysian manufacturing sector mainly in non-metallic mineral products, electrical and electronics products, basic metal products and fabricated metal products,’ said in the release.

When asked by Korean Press on the reason they host the speech, Mr. Hwang Gyu-Joon said last year they also organized a seminar for local Korean companies in Malaysia but many Malaysian buyers and Korean companies did not know about the effects of the FTA since it was implemented last year 2007.

Effects of FTA

The seminar begins with the speech of Mr. Kim Hee Joong, Deputy Director, Korea Trade-Investment Promotion Agency, KOTRA on ‘The effect, change to the trade environment following the ASEAN-Korea FTA’.

In the seminar, Mr.Kim explained that FTA is an agreement that mutually gives exclusive trade benefits to the specific country and the primary focus will be on free trade through tariff reduction. He said Malaysia stands to see an additional 0.55% GDP (Gross domestic product) growth as a result of the agreement.

‘For example, in ASEAN market he said there will be tariff elimination of Auto CKD (completely knocked down) by 2010 and in Korean market, there will be radio tariff elimination by 2008 and tariff elimination by 2010 for sweaters, trousers for men,’ said Mr. Kim.

‘Seoul eliminated tariffs on 70% of products categorized under the normal track category in June last year with the rest to see tariff liberalization by 2010,’ he adds.

FTA Benefits

This followed by the second speaker of the seminar, Mr. Lee Duk Soo who talked about ‘Customs Changes Under Korea-ASEAN FTA’. In his speech, he describes FTA as a trade highway that allows trade liberalization by reducing tariff barriers between specific countries or regions. He said FTA can help increase export and production. In his speech, he explained on how to enjoy the benefits of FTA by using the C/O and how Korea Custom Services provide business support activities. For more details, public can visit website http://english.customs.go.kr

Elements of FTA

The 3rd speaker of the seminar, Mr. P. Ravidran, Senior Director Ministry of International Trade and Industry, MITI talks on ‘Malaysia-Korea Opportunities through AKFTA’.  He mentioned on the objectives of FTAs are to seek better market access for goods and services, facilitate and promote trade, investment and economic development, capacity building in specific areas through technical co-operation and collaboration.

‘The main elements of FTA are progressive liberation of trade in services and investment plus progressive elimination of tariffs by 2010 for ASEAN-6 and Korea, 2018 for Vietnam and 2020 for CLM countries. FTA is also established to improve economic co-operation in areas of common interest. In 2007, Korea was Malaysia’s 6th largest trading partner, 8th largest export market and 7th largest import source. In year 2007, Malaysia equity investment in Korea is USD6.97 million (RM24million) and USD11.4 million (RM42million) in year 2006’ said Mr. P. Ravidran.

More Projects

Mr. Azman Mahmud, Director (Asia Oceania) from Malaysian Industrial Development Authority, MIDA talks about ‘Investment Opportunities in Malaysia’. In his speech, Mr. Azman talks about MIDA’s functions in the promotion of the manufacturing and services sector in Malaysia.

‘192 manufacturing projects are approved by MIDA from January-March, 2008 whereby the approved investment for domestic is USD2.1 billion and foreign investment is USD4.9 billion compared to 949 total projects year 2007 whereby the approved investment for domestic is USD7.7 billion and foreign investment is USD9.7 billion,’ said Mr. Azman.

According to Azman, Malaysia would like to see more South Korean participation in information and communication technology, machinery and engineering support, construction, pharmaceuticals, biotechnology, software development, consultancy services and business process outsourcing (BPO). He said South Korean investments approved for local manufacturing projects increased 2.7 times to USD325.2 million (RM1.05 billion) last year.

Identifying risks

The 5th speaker of the seminar, Mr. Girish Ramachandran, Executive Director of RSM Strategic Business Advisors talked about ‘Strategic Business Planning for Mergers, Acquisitions and Joint Venture’. In his speech he explain on how to identify key risks, opportunities, strategic planning, corporate planning, key items to consider in a joint venture agreement and gave examples of case studies for solutions.

Understanding workforce

Dr.Wahab Salleh, Hr Advisor from Samsung Group Malaysia talked about ‘Effective Labour Management in Malaysia’. Dr.Wahab said the total workforce in Malaysia is 11.5 million consist of 407 unions (431,457 members) in private sector and 222 unions (371,322 members).

Avoid Legal disputes

Mr. Kamraj Nayagam Partner from Skrine Advocates & Solicitors talked about ‘Effective Dispute Resolution in Malaysia’. He said Skrine is one of the oldest and largest law firms in Malaysia.

‘Prior and formation of legal relations is important to avoid disputes so as tominimize future disputes. Draft contracts that address the duties and obligations of the parties involved when things go wrong as well as when they go right, establish an avenue and manner of dispute resolution, seek legal advice should be kept in mind in avoid or minimize future disputes,’ said Mr. Kamraj.

The seminar ends with buffet lunch and individual consultation time from 2:00 p.m. till 5.00 p.m. evening at ballroom, mezzanine floor, Equatorial Hotel, Kuala Lumpur.

Reported by Cecilia, Korean Press  /  Video by  aziz zul


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