“The CPTTP will elevate Malaysia's prominence as a global trading economy and total trade is expected to increase to US$655.9 billion (RM3.04 trillion) in 2030."
This follows the government’s submission of the instrument of ratification for the agreement to New Zealand, the CPTPP depositary, on Sept 30, 2022, said the International Trade and Industry Ministry (MITI).
In a statement on Wednesday (Oct 5), MITI said the ratification comes after years of detailed deliberation, extensive consultations and careful assessment by the government.
In light of the findings of the cost-benefit analysis (CBA), it is clear that the benefits accruing from the ratification of the CPTPP far outweigh any potential costs that may arise from the implementation of this agreement, it said.
“In sum, the CPTPP places Malaysia in a strategic position, elevating our competitiveness in the global arena.
"As a bloc that advances regional economic integration, the CPTPP is also a testament to the significance of the multilateral trading system," it added.
MITI said the CPTPP broadens Malaysia's access to new markets such as Canada, Mexico and Peru, which are not covered by any existing free trade agreement, providing access to a wider range of high-quality raw materials at competitive prices, and increases the country's attractiveness as an investment destination.
It said the CPTPP also offers technical assistance and capacity building programmes that are aimed at improving and developing local sectoral capabilities in key industrial areas such as automotive, electrical and electronics, chemicals, optical and scientific equipment as well as medical devices.
“The CPTTP will also elevate Malaysia's prominence as a global trading economy and total trade is expected to increase to US$655.9 billion (RM3.04 trillion) in 2030.
"In addition, the CBA’s findings also indicate that Malaysia’s exports are projected to reach US$354.7 billion in 2030, with trade balance remaining in strong surplus at 8.5% of gross domestic product for the same year," the ministry said.
MITI said under the CPTPP, by Jan 1, 2033, almost 100% of Malaysian exports to all CPTPP countries will enjoy duty-free treatment.
“As a matter of fact, as soon as the CPTPP enters into force for Malaysia, all our exports to Australia and Singapore will readily enter these markets without being subjected to any duties.
“Subsequently, in 2024 and 2029, all Malaysian products exported to New Zealand and Canada, respectively, will enter these countries duty-free,” it added.
Meanwhile, high duties on key Malaysian exports to Canada and Mexico, which currently range from 15% to 30%, will be eliminated immediately.
“This essentially means that Malaysian exporters will enjoy duty-free treatment on products such as automotive parts and components, plastics products, surgical gloves, rubber products, textiles and clothing, cocoa products and food items,” MITI said.
In the processed food and beverages sector, Malaysian exporters will be able to expand their businesses into Canada, Mexico, Japan and Peru.
“Since current duties for this sector can go up to 313.5% in Canada, 158% in Mexico, 52.5% in Japan and 17% in Peru, Malaysian exporters will benefit from significant reductions in import duties, under the CPTPP.
“For these countries, all duties currently imposed on processed food and beverages will be eliminated by the year 2028 (Canada), 2032 (Mexico), 2038 (Japan) and 2033 (Peru),” it added.
Moreover, MITI said, the CPTPP contains trade-facilitative rules of origin (ROO) that are designed to support modern business practices and further promote deeper integration of Malaysian businesses into regional supply chains.
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