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Malaysia Us Free Trade Agreement

Eight rounds of negotiations have taken place since the U.S. Trade Representative announced on March 8, 2006, the Bush administration`s intention to negotiate a free trade agreement with Malaysia. A ninth round of talks, scheduled for November 2008, was postponed after the inauguration of President Barack Obama, after it emerged that several outstanding issues had not been resolved. Since the postponement, Malaysia has suspended bilateral negotiations, possibly in response to U.S. support for Israeli military operations in Gaza. On December 30, 2007, Barbara Weisel, U.S. Deputy Trade Representative, confirmed that “the United States continues to try to conclude the agreement by this summer, which we believe is achievable”… 16 Weisel also stated that the Bush administration would seek an “appropriate means” to obtain Congressional approval for the proposed free trade agreement once negotiations have been concluded.17 Despite the relatively small volume of services trade with Malaysia, several U.S. service sectors – including telecommunications, financial services and insurance service providers – have shown strong interest in improving access to the Malaysian domestic market. Several sessions were held to discuss things that proved sticky for both parties.

The United States worked on an agreement before the end of the Trade Promotion Authority in July 2007; The TPA is an agency that the U.S. Congress gives to the U.S. president to expedite free trade negotiations between the United States and foreign countries. Despite the delays, both the United States and the Malaysian side have not been able to move forward and the negotiations are not yet complete. The U.S. Trade Representative submits a report to the Ways and Means Committee on the intention to begin negotiations for a free trade agreement between the United States and Malaysia. A free trade agreement between the United States and Malaysia would also improve U.S. access to Southeast Asian economies. Malaysia has already concluded free trade agreements with Indonesia, Brunei, Singapore, the Philippines and Vietnam under the ASEAN Free Trade Area, and ASEAN is close to concluding a free trade agreement with India.

It has a free trade agreement with South Korea and Pakistan, an economic partnership agreement with Japan that covers most of merchandise trade, a partial free trade agreement with China, and it negotiates free trade agreements with Australia and New Zealand and discusses a free trade agreement with India. On 19 April 2007, Chile and Malaysia announced that they would begin negotiations in June for a bilateral free trade agreement, with the first round of talks in Kuala Lumpur.80 When the talks began, the USTR`s objective was to review by Congress the law on the implementation of the free trade agreement between the United States and Malaysia as part of the fast-track procedures of the Bipartisan Trade Promotion Act (TPA) 2002 (P.L. 107-210) 1011 Statute requires the President to inform Congress of his intention to conclude the agreement at least 90 days schedule before the conclusion of the trade agreement. Given that on July 1, 2007, the Presidential Trade Development Authority expired and the President did not notify Congress as of April 2, 2007, the U.S.-Malaysia Free Trade Agreement was no longer eligible to be considered under TPA 2002. This report discusses the proposed free trade agreement between the United States and Malaysia. It provides an overview of the current state of the negotiations, a review of the 2008 discussions, a review of key issues ahead of the negotiations, a review of U.S. interests in the proposed agreement, a summary of the possible consequences of a free trade agreement on bilateral trade, and an overview of the legislative procedures to be followed when the proposed free trade agreement is submitted to Congress for approval.