Malaysia trying to evade AFTA with duties on cars?
Malaysia trying to evade AFTA with duties on cars?
Agence France-Presse, Kuala Lumpur
A Malaysian opposition leader on Sunday sought a review of proposed excise duties for imported cars, saying consumers were entitled to cheaper cars under a regional free trade pact.
Lim Kit Siang, chairman of the Democratic Action Party, accused the government of trying to evade the introduction of the Association of Southeast Asian Nations (ASEAN) Free Trade Area (AFTA) in 2005 by substituting import tariffs for foreign cars with the proposed excise duties.
The move is clearly aimed at protecting national carmaker Proton which "has not shown any signs of being able to stand on its own feet without government props at the expense of taxpayers and consumers," Lim said.
"Malaysians are entitled to protest if they do not derive any benefit whatsoever with the coming of AFTA," Lim said in a statement.
"Consumers are entitled to look forward to lower car prices and meaningful choices after two decades of protection for the national car."
Tariffs for most products in the region were slashed to below 5 percent in January under AFTA but Malaysia, the biggest car manufacturer in the region, has delayed opening its auto sector until 2005.
Veteran Prime Minister Mahathir Mohamad reiterated in his farewell budget on Friday that car prices would not fall under AFTA and urged consumers to buy now.
"The government proposes to levy excise duties on imported cars when import duties are reduced from 1 January 2004," said the premier who will retire in late October. He did not give details.
But Lim urged members of parliament to seek a review of the excise duties during parliamentary debate on the budget starting Monday.
"It is time that the interests of the Malaysian consumers be given attention and priority after some two decades of protection for Proton, which should not become a bailout for inefficiency, low productivity or poor management" by the national car manufacturer, he said.
Foreign car sales rose 19 percent in the first half this year at the expense of nationally-built cars, Proton and Perodua, which are feeling the heat ahead of market liberalization.