MALAYSIA TO LOOK BEYOND TRADE WITH EU PCA

By Siti Hawa Othman

KUALA LUMPUR, Dec 21 (Bernama) -- Malaysia will be looking beyond bilateral
trade and investment once it begins the negotiation process on the partnership
cooperation agreement (PCA) with the European Union (EU).

"Once we started this, we can look at bilateral FTA," said Hussein
Haniff, Malaysian Ambassador to Belgium concurrently accredited to the EU and
also Luxembourg.

"If we have these agreements, then cooperation could be upgraded with the
EU," he told Bernama in Brussels recently.

A PCA is a comprehensive agreement on bilateral and multilateral cooperation
ranging from politics, economics, trade, investment, justice, culture,
education, science-technology, healthcare, agriculture, tourism, energy and
traffic to environment.

Individual Asean members will first need to sign a PCA with the EU to be
able to qualify for the free trade agreement (FTA).

So far among Asean, only Indonesia has signed a PCA with the EU while others
such as Singapore, Thailand, the Philippines and Vietnam are in various stages
of negotiation. Malaysia has yet to begin negotiations.

"Malaysia is interested because we are the second largest trade partner with
the EU among Asean after Singapore," said Hussein who was posted to Brussels
since August 2008.

Meanwhile, an embassy official said the European Commission (EC), which is
the executive body of the EU, had formally extended a draft PCA to Malaysia in
2006.

Since then, clarifications have been sought from the EC on the contents of
the agreement which are mostly political in nature, she said.

"Being political in nature, Malaysia would have to scrutinise the contents
carefully before embarking on the negotiations," the official said.

The PCA would further widen and deepen relations with the EU as it addressed
issues that go beyond trade, the mainstay of Malaysia-EU relations, she added.

Touching on bilateral trade between Belgium and Malaysia, Hussein said
Malaysia was trying to improve trade with the country.

Total trade from January to October 2009 stood at RM2.6 billion
(US$1=RM3.43), lower than the RM3.6 billion registered in the first 10 months of
2008.

Total trade for the whole of 2008 was at RM4.2 billion, which was to
Malaysia's favour with exports at RM2.3 billion.

Major export items included electrical and electronic products, chemicals
and chemical products, textiles and apparel, sawn logs and sawn timber, iron and
steel products.

In terms of investments, Hussein said Belgium was eager to see cooperation
in the new areas of green technology and biotechnology with counterparts in
Malaysia.

"Those that are linked to environmental issues. They have companies dealing
with palm oil. If we can match the two sides, we can increase trade. Belgium has
strength in these areas and we can collaborate with emphasis on biotechnology,"
he said.

Malaysian investments in Belgium stood at RM211 million from January to
September 2009 as against RM2.42 billion for the whole of 2008.

In turn, Belgian investments in Malaysia stood at RM2.94 million from
January to August 2009 compared to RM105.099 million for the whole of 2008.

-- BERNAMA