Posts tagged trade
Malaysian auto parts manufacturers have spent years building a reputation for product build quality and supply reliability, exporting their products to several automakers around the world. Appealing to Japanese automakers, however, is another story entirely. A contract with a major manufacturer there offers lucrative rewards and increased stature, but Japanese thoroughness and taste for flawless quality present extra challenges to suppliers.
Some Malaysian companies were making inroads into the Japanese market even before the 11 March disasters in Tohoku damaged supply chains. The two countries signed a five year Economic Partnership agreement in 2006, with an auto industry component providing a skills training center in Malaysia and a number of trade shows.
Since March, many Japanese companies have expressed a desire to diversify their risks by teaming up with manufacturers in other Asian companies and Malaysia has found itself in a prime position. Trade agencies JETRO and MATRADE are aiding firms to find each other and achieve profitable outcomes on both sides. (more…)
The Philippines Department of Trade and Industry (DTI) is keen to expand business links in New Zealand after holding information sessions in Auckland and Wellington this week. It identified key export industries like ship-building, backroom engineering design, nursing/healthcare and other skilled business outsourcing functions as key targets for NZ investment.
Attendees were also interested in the food trade, with the Philippines offering mangoes, coco sugar and coconut oil and New Zealand looking to export its honey and ice cream. New Zealand’s 40,000 resident Filipinos would provide a ready-made market for exports.
The Philippines and New Zealand are already covered by the Asean Australia-New Zealand Free Trade Agreement (AANZFTA), which began January 2010 and allows Philippine goods to enter New Zealand tax-free until 2020. The information sessions were part of a DTI project designed to highlight opportunities for the Philippines under current agreements, called the ‘Doing Business in Free Trade Areas’ (DBFTA) Program. As well as AANZFTA, the Philippines also has free trade agreements with China, Japan, Korea, and recently signed with India.
It’s not just big Japanese businesses presenting opportunities for Malaysian manufacturers. With several Japanese small and medium sized enterprises (SMEs) looking to diversify risk, Malaysia is stepping up to offer an alternative location to these smaller businesses for manufacturing and data management facilities.
Again, Malaysia is interested primarily in Japanese automotive, electrical and electronics companies.
After Tohoku’s string of destructive tragedies in March, Japan’s own government has called for local firms to protect themselves by moving some functions overseas. Malaysia’s Deputy Minister of International Trade and Industry, Mukhriz Mahathir, said that his country offered a secure location outside earthquake danger zones and business-friendly policies.
source & article: MIDA
Malaysian and other Southeast Asian manufacturers are making themselves known in Japan, and more Japanese companies than ever are looking for overseas collaborations. International trade fairs are a fantastic opportunity to showcase a company’s offerings but adapting to each other’s business culture can make the experience more profitable, says Japan’s largest overseas trade organization.
The Japan External Trade Organization, or JETRO, has been around since 1958. Its original mission was to promote Japanese exports in overseas markets, but given radical economic shifts in Japan and elsewhere since then, its mission has broadened to include general facilitation of business understanding between Japanese companies and their overseas partners. This happens mainly through trade fairs, seminars, data-gathering, trade missions and publications. It has offices in 73 cities in every world region, of which 24 are in Asia and nine are in ASEAN countries.
JETRO offers a surprising amount of support to foreign enterprises looking to build a position in the Japanese market. For trade fairs it offers prime exhibition space and decoration, pre-arranges meetings and study tours before the fair begins, actively promotes exhibitions through the media and direct mail, and provides several interpreters.
I spoke recently to Ms. Mio Kawada, JETRO’s Director of International Trade Fairs in Japan, who in May oversaw the fifth Malaysian Auto Industry Exhibition (MAIE) in Yokohama. The expo featured 11 Malaysian manufacturers seeking export and import opportunities, OEM arrangements, technical alliances and other joint ventures with their Japanese counterparts. A glance at the Malaysian auto industry’s experience in Japan offers useful and universal pointers to other industries as well. (more…)
Chinese Premier Wen Jiabao brought great news and economic rewards for Indonesia on his two-day official visit, along with a delegation representing 150 Chinese companies. The results were offers of multibillion dollar loans, US$10 billion worth of business contracts, $8 billion worth of financing contracts for companies willing to invest in Indonesia’s major infrastructure projects, and a $1 billion ‘preferential buyer’s credit’ for Indonesia, reportedly the largest China has ever awarded a foreign country.
The $8 billion in financing contracts will come mainly from the China Investment Corp ($4 billion), the Export-Import Bank of China and the Commercial Bank of China. Bilateral trade between the two countries reached $42.7 billion last year, a 50.6% increase on the previous year, with Wen saying it could feasibly reach $80 billion annually by 2015.
Wen’s visit was the first official visit to Indonesia by a Chinese Premier in a decade, and hinted at a much closer economic and strategic relationship between the two countries. He announced the plans at a joint media conference with President Susilo Bambang Yudhoyono. They also announced new regular top-level meetings between leaders and dialogs at vice-prime-ministerial level, plus new programs to cooperate on maritime security, resources exploitation and disaster response.
China took particular interest in Indonesia’s large-scale ‘six economic corridors’ development strategy and the many opportunities for investment and progress it produced. The Indonesian Ambassador to China, Imron Cotan, seemed particularly pleased at the thought of enhanced relations, saying that China was willing to share its technology and put no preconditions on investment, and understood that Indonesia’s prosperity and regional stability would be beneficial to China’s own progress.
source & article: China Daily
FedEx has chosen Singapore’s Changi Airport for a 282,700 sq foot Regional Hub, the second-largest facility of its type in the Asia-Pacific region. Scheduled for completion in 2012, it will bring Singapore’s FedEx delivery, pick-up and air operations all under the one roof. Singapore, the company said, was chosen for its access to global markets, central location, and aspiration to be a leading regional air cargo hub.
The FedEx facility will form part of Changi airport’s Air Cargo Express (ACE) hub, inside Singapore’s Airport Logistics Park and Changi’s Free Trade Zone. It will be equipped to handle more than 9,000 packages per hour with a 5-belt sorting system and has parking bays to house 250 delivery vans and two aircraft. Singapore Customs and the Immigration & Checkpoint Authority will also have a facility on-site to streamline cargo clearance.
source & article: AsiaOne Business
Malaysia is embarking on an ‘aggressive’ economic and government transformation that will be highly responsive to foreign investors’ needs, Prime Minister Najib Razak said to a gathering of over 600 industry leaders in South Korea this week.
The PM is on a three day working visit to promote investment opportunities in Malaysia, and his words have apparently been well received by South Korean business representatives. The two countries also signed a memorandum of understanding to establish a joint business council and are exploring the possibility of a free trade agreement, on top of South Korea’s existing FTA with ASEAN.
South Korea is Malaysia’s seventh-largest foreign investor, with a US$2.7 billion stake and 700 companies with operations there. Trade between the two countries has doubled over the past decade, and Malaysia would like to see it double again. Major Korean interests are advanced electronics, petroleum, minerals and fabricated metal, with Malaysia especially keen to develop the high tech relationship, including biotech and pharmaceuticals. The Malaysia-Korea Business Council identified green technology, automotive and pharmaceuticals as the sectors which would benefit most from Korean collaborations.
As an Asian country that has successfully made the leap from poor to wealthy developed status over a relatively short period of time, South Korea has particular appeal to Malaysia. It aims to replicate South Korea’s growth and become a ‘fully developed’ nation itself by 2020, building on strengths in similar technology and manufacturing industries.
Of ASEAN countries, which are most dependent on Japan for exports? Check out this chart from The Economist which shows Brunei’s exports of US$3 billion per year (28% of its GDP) and Malaysia’s $15.5 (18% of GDP) as having the highest exposure to any changes brought by Japan’s recent disasters. That’s not to say they’re in most danger though, as Brunei’s oil and natural gas and Malaysian timber will likely play a large role in Japan’s reconstruction. At greater risk are Singapore ($12.3 billion/7% of GDP) and Thailand ($15.7 billion/6% of GDP), also large exporters, but who also rely on Japanese made components for manufacturing.
source & article: The Economist
Brunei once had a reputation as one of Southeast Asia’s key trading hubs. It can become that again, say the makers of Brunei’s first e-business portal.
For over 500 years, Padians were river traders who sold their goods from boats in Brunei’s Kampong Ayer (water villages). Their contribution to the local economy, and Brunei’s reputation in the wider area as a trading port, became invaluable as they brought necessary items directly to residents from shops, farmers and other traders further away.
That’s the kind of entrepreneurial spirit Rushdi Ibrahim and Shafique Hussain want to reinvigorate with Padian.com, a complete e-business hub created by AMIR Consortium Sdn Bhd* and designed to connect Brunei’s small and medium enterprise (SME) operators with local and overseas clients, customers and government tenders.
“We wanted people know know: we are here,” says Rushdi, Operations Director and one of the project’s owners. The portal is at the forefront of Brunei’s efforts to restore its historic reputation as a trading center, after decades of watching larger neighbors like Singapore grab the spotlight. Their success will depend on attracting users not just in Brunei, but across ASEAN and the rest of the world. Padian.com is an active participant in trade shows around the world — the two have spent the past week in Tokyo drumming up new business and meeting local entrepreneurs, many of whom remain unaware of Japan’s appeal and marketability in other parts of Asia.
“Our initial focus was to help Brunei SMEs,” says Shafique, Padian.com’s Head of Marketing. “They had good products but not marketing and IT knowledge. We wanted to give them the opportunity to sell their products and image online easily, so they can just focus on producing products.”
“We wanted to make it very Bruneian,” he adds, referring not only to local produce but the country’s image as a place to make deals. “We wanted to help businesses grow, to reach out to others and build a bridge between all countries in the region.”
The Secretary General of Malaysia’s Ministry of International Trade and Industry, Dr. Rebecca Fatima Sta Maria, gives a brief progress summary of the Asean Economic Community (AEC) project to integrate Southeast Asia’s economies into a more cohesive bloc. Started four years ago, the project has another four years to meet its 2015 deadline. How does everything look at the halfway point?
It is important, she says, to look at the goal itself and dispel any notion that Asean is trying to become a customs union or common market in the form of the European Union. Each of the world’s regions has its own regional framework to suit the economies and unique conditions of that part of the world, whether it be NAFTA, the Gulf Cooperation Council or UNASUR. With its diversity of economic development and somewhat similar and competing industries, Southeast Asia realizes it is not in a position to form a union anything like the EU… at this stage. So what is the AEC’s 2015 aim?
The AEC is, in a nutshell, the realisation of a competitive and dynamic region which allows for free flow of goods, services and investment, and freer flow of capital and skilled workers by 2015. Tariff and non-tariff barriers are to be gradually eliminated.
On the surface these might seem like fairly loose goals, but they’re just first steps. ASEAN is aiming at something called ‘open regionalism’, where the organization as a whole can sign trade treaties but within which individual countries may form their own agreements. Intra-region trade has been made much freer with 95% of traffic now tariff free. The Self-Certification System and the Asean Single Window have sped up trade by reducing bureaucracy and introducing measures to make transportation more efficient. These moves in turn make the region more attractive to outside investors.
The AEC has met 83.8% of its first-phase (2007-09) objectives, and will try to achieve 100% of them plus more in the second phase (2010-11). New measures to ease movement of skilled labor across borders, an aviation ‘open skies’ policy, healthcare, environmental and tourist cooperation strategies and transparent investment rules are all on the agenda over the coming years.
Planners are confident the AEC can reach its goals and become an attractive and somewhat integrated economy of 600 million people in the next four years. And while ASEAN may not aspire to be like the European Union in the immediate future, there are clearly those who harbor dreams of something closer to it in the longer term.
source & article: Business Times