Let’s seal the deal this year: Finland’s envoy

KUALA LUMPUR (Feb 17, 2014): The Malaysia-European Union Free Trade Agreement (MEUFTA), which is expected to come to fruition in 2014, will grant trade opportunities between Finland and Malaysia, said Finland's Ambassador to Malaysia Matti Pullinen (pix).
"For us, the Europeans, the main target which we have been working on, is that we should have a free trade agreement (FTA) between Malaysia and the European Union as quickly as possible," Pullinen told SunBiz in an interview at the Embassy of Finland recently.
The MEUFTA will provide free movement of goods and services as well as the protection of intellectual property, while a stable and forward-looking economic environment will also encourage more investment, said Pullinen, 65, who started his term as ambassador in Kuala Lumpur at the beginning of September 2012. The agreement is expected to give tax-free access between Malaysia and the EU.
"I think this year is a realistic target. We have everything to make every effort to get things done. I don't see any particular reason for further delay, it could be done any time this year," he said.
"(The European Union has been negotiating FTAs in this region for the last five to 10 years). These FTAs were supposed to be concluded some time ago, but (this happens with most free trade negotiations)," Pullinen explained.
The most recent delay, he said, was mainly due to the general election in Malaysia, as well as the political and economic situation in Europe.
He added that MEUFTA could have started earlier, but has now been complicated due to the Trans-Pacific Partnership Agreement (TPPA) negotiations.
Pullinen is of the view that while the TPPA and MEUFTA are of a similar size, he does not see the FTAs as threats to each other.
"(The TPPA) is what America and Canada is trying to (execute), while we (Finland are doing it) from the European side. We don't necessarily have to move faster than the TPPA. We won't be jealous at all if TPPA proceeds more quickly than us, and I don't think our American friends will be jealous if we are able to move ahead," he said.
Pullinen said he does not foresee much of an impact on Finnish businesses if TPPA comes into effect, as many Finnish companies have global footprints nowadays, and production facilities can easily be shifted to other free trade partners.
Finland is frequently ranked as one of the least corrupt countries in the world, as well as coming up tops in the top of the globe in terms of education, research and development (R&D) spending per capita, and environmental sustainability.
"MEUFTA has to be done as quickly as possible, because these arrangements will have an impact on the direction of investment from any country to Malaysia. If there is an uncertainty on the FTA, that would delay the investment decision," Pullinen said.
According to the Finnish Customs statistics, the total export value of Finland goods to Malaysia was about €151.8 million in 2011, most were paper and paperboard, iron and steel as well as electric machinery and parts.
Malaysia on the other hand exported products to Finland worth €280.6 million in 2011. Most Finnish imports were vegetable fats and oils, crude rubber as well as telecommunications and sound recording equipment.
"Finland is a very open market as always. When a Finnish company (thinks about) where they should put their money, (a key consideration would be the FTA).If one country has a FTA with Europe while another doesn't, that would affect their decision," said Pullinen.
Finland and Malaysia established diplomatic relations in 1972. The Nordic state, which is a member of the European Union since 1995, has had a resident ambassador in Kuala Lumpur since 1988. However, no FTA is signed between European Union and Malaysia at the moment.
On another note, Pullinen said Malaysia is a good place for Finnish companies to start their international operations in Southeast Asia, adding that 80% to 90% of the existing Finnish companies in Malaysia are happy.
"Of course, in doing any business, there are problems some time. But it is fair to say that Malaysia is a solid, stable and reliable market. If you're planning for an investment in this region, Malaysia certainly remains as one of the safest places," he concluded.