UK to broaden ties with Malaysia post-Brexit, may not need FTA

KUALA LUMPUR: The UK, which aims to be more outward-looking post-Brexit, is exploring ways to deepen and broaden its relationship with Malaysia, which may not require a free trade agreement (FTA).
“We discussed this morning how we might work together to ensure that there is even greater openness. Perhaps that does not require any FTA to provide those opportunities,” UK Secretary of State for the Department of International Trade Dr Liam Fox told reporters at the “Malaysia and Britain, Partners in a post-Brexit World” panel discussion yesterday.
“What we are looking for are ways in which we can get more liberalisation in economies more quickly and with greater agility; getting our economies to be able to respond quickly to changing circumstances, e-commerce and the digital economy being a good example. The more agile we are, the better,” he said.
While it is open to new FTAs, Fox said any new agreements with Asean will only be made after monitoring the development and growth of the region, and considering what sort of trading agreements are suitable.
“We are not saying not interested but for the UK, we have two years to get our trading sorted out at WTO, to be able to adopt 40 EU trading agreements with countries outside the EU into our law and to look at some new major potential FTAs. The US, New Zealand and Australia have expressed interest and now we have to focus on what will come after that once we actually leave,” he added.
Although the UK will only be able to sign any agreements at the end of the two years, Fox said it is already doing a lot of groundwork in preparation for any new potential agreements.
“We should identify some areas where we can promote closer cooperation and that may not come under the ambit of FTA. We both agreed that FTA is only a platform. It is good to have FTA but there are other possibilities to enhance bilateral ties including identifying some niche areas.”
International Trade and Industry Minister Datuk Seri Mustapa Mohamed said Malaysia did not achieve its £8 billion (RM44.2 billion) trade target with the UK by 2016 and only managed to achieve £3 billion due to the impact of the global economy and commodity prices.
“For us, trade only expanded 1.5% last year so it is unreasonable for us to expect great growth in trade with the UK. But we need targets. That target was set 4-5 years ago and we should be working towards this target in the next few years,” he added.
Fox stressed that the UK will be more open and more globally focused post-Brexit as it recognises the opportunities presented by this region and the expectation that 90% of global growth will occur outside Europe in the next decade.