Malaysian Trade Policy and the 2001 WTO Trade Policy Review

The purpose of this paper is two-fold; to examine developments in trade and
investment policy regimes in Malaysia following the on-set of the financial crisis, using the
Trade Policy Review Malaysia 2001 of the WTO as a reference point; and to evaluate the Review
in terms of the objectives of the WTO Trade Policy Review Mechanism as set out in the
Marrakesh Agreement. It is found that, by and large Malaysia has managed to come out of the
crisis without compromising on its long-standing commitment to maintaining a relatively open
trade and investment policy regime by the regional standards. However, there are some
disturbing post-crisis developments, which deserve scrutiny in a future Review. These include
increase in the degree of dispersion of tariff rates because of high tariff peaks relating to a few
product lines, increased reliance on non-automatic import licensing to regulate imports of a
significant number of products which directly compete with domestic production by public sector
enterprises, and unexplained delays in meeting commitments under the General Agreement on
Trade in Services (GATS)