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.