NCGA Encourages Comprehensive Negotiations in US-Malaysia FTA (5-16-06)

The National Corn Growers Association (NCGA) encourages comprehensive negotiations without limitation or exceptions in any sector in the U. S.–Malaysia Free Trade Agreement (FTA) in comments submitted May 12 to United States Trade Representative (USTR) Rob Portman.

Under the agreement, the U.S. agriculture industry, specifically the feed grain sector, will realize benefits of increased corn exports beyond the current 2.5 million metric tons already exported and will secure tariff-free status to prevent any increases in the future.

Gerald Tumbleson, NCGA president said in the comments, “NCGA commends President George W. Bush’s administration for its interest in pursuing an FTA with Malaysia. Malaysia provides favorable tariff treatment for U.S.-refined products, but this FTA could ensure that we prevent any erosion of those benefits.”

Bob Bowman, NCGA Joint Trade Policy A-Team chairman, said this agreement will ensure the United States is competitive with Argentina and China, which currently supply the vast majority of corn to Malaysia.  
 
“This market is dominated by China and Argentina,” said Bowman. “With a comprehensive FTA, we will take the necessary steps forward to ensure we are competitive with China and Argentina and that we are not just a residual supplier in that market.”

According to the U.S. Department of Agriculture, Malaysia’s corn imports will increase 12 percent to 2.6 million tons in 2006 with imports increasing another 9 percent by the end of 2007. Malaysia is already the largest corn importer in Southeast Asia, importing about 2.5 million metric tons annually.

The comments to the USTR also discussed biotech corn, stating that the acceptance of biotech products and the labeling requirements Malaysia is developing could be “constraints to importing U.S. grains in the future.” NCGA pointed out it is important to resolve any outstanding issues regarding imports of biotech products as part of this FTA to ensure future regulations have minimal effect on corn and corn products exported to Malaysia.

“While Malaysia has not officially approved the imports of biotech corn, to date it has not restricted the importation of those products either,” the letter stated. “Meanwhile, the Malaysian Cabinet has approved a Biosafety Bill; however, due to the Malaysian Secrecy Act, the details of this bill and internal debates are not publicly available. The Ministry of Health is responsible for food safety, and while it has been supportive of U.S. efforts in biotechnology, Malaysian officials intend to implement labeling requirements for biotech-derived foods. The new regulations are supposed to be implemented as soon as the Biosafety Act is in place.”

Earlier in May, USTR notification on the intent to negotiate an FTA with Malaysia set into motion the 90-day congressional consultation period pursuant to the Trade Promotion Authority.

To view the comments in their entirety, please click here.