Australian Logistics industry leaders will lend a hand to counterparts in Malaysia following high level discussions in Kuala Lumpur this week
By Anna Game-Lopata | May 25, 2012
Australian Logistics industry leaders will lend
a helping hand
to counterparts in Malaysia following high level discussions in Kuala Lumpur this week.
Set up and run by Australia’s High Commission, the bilateral meeting involved delegations from both Australian and Malaysian logistics industry bodies as part of official FreeTrade Agreement proceedings between the two nations.
Supply Chain and Logistics Association of Australia (SCLAA) Director Mark Skipper chaired the Roundtable discussion on behalf of Australia’s industry, which was also represented by the Toll Group, Linfox, shipping line ANL and BlueScope Steel among others.
Skipper tells SupplyChain Review there needs to be close synergies between Malaysia and Australia not just on tariffs but on logistics efficiencies.
“In order to improve trade ties, we need to engage logistics at the ports, on the roads and at the air terminals,” he says.
While the elimination of 97 percent of tariffs on specific Australian goods to Malaysia from January 1 next year will be of benefit to exporters, Skipper says industry must remain alert to some exemptions.
“For example, dairy products such as milk, for which Malaysia is our second biggest export market, will retain tariffs until 2017 under ‘a liberalised licensing arrangement allowing access for higher value retail products’,” he says.
“Rice will retain a tariff until 2026.”
Skipper says according to Kuala Lumpur Senior Trade and Investment Commissioner Elodie Journet, there is still
some work to be done on the fine detail of the agreement between now and January.
“Exporters need to be aware of which items incur a tariff from January and which don’t,” Skipper adds.
“These details are currently in the hands of Austrade and will be announced later in the year.”
Skipper says the Roundtable revealed the Malaysian logistics industry is keen to learn from Australia in three main areas: energy efficient transport, transport regulation and education.
He says an agreement has been made for Australia to work with Malaysia on regulation such as Chain of Responsibility and weight limits for heavy vehicles.
“There are 6000 road deaths per year in Malaysia many as a result of overloaded trucks and this is expected to rise to over 10,000 by 2020,” Skipper says.
“They want to learn from our experience in terms of the most effective ways to police regulation, because currently checking stations are often closed and police can be bribed to let the rules go.”
“On our side, companies like Linfox and Toll, who follow the rules may need to charge higher prices, so industry is looking to level the playing field from that perspective.”
Skipper says other outcomes of the discussion included an expressed desire to investigate tracking technology for temperature sensitive goods and setting up post graduate logistics courses.
“Malaysia is looking to become a certified halal hub for the Muslim world,” Skipper says.
“The Malaysian delegation was very interested in looking into technology which can track temperature and utilise light sensors if a container has been opened.
“They weren’t aware of the existence of this kind of equipment before and now they are.”
The Free Trade Agreement with Malaysia was signed on Tuesday 22 May between
Australian Minister for Trade Craig Emerson and Malaysian Minister of International Trade and Industry Dato’ Sri Mustapa Mohamed.
Australia will eliminate all tariffs on goods from Malaysia from January 1, 2013, while Malaysia will take a phased approach with 97 percent eliminated on January 1 next year and all tariffs eliminated by 2026.
Malaysia is Australia’s 10th largest trading partner, with two-way trade worth $16 billion in 2011.