Asean should integrate into a single economic entity. We know that there are differences in the economies of member countries, but we are taking too leisurely a pace to forge a regional market.
The EU has done so much in economic integration despite the economic levels in member states. We should be stepping up to create a bigger market. Asean, as a whole, is half the market size of China.
Why is the promised 5 percent tax tariff for all founding members not exercised? Since this year is the year when the founding members are supposed to lower their tax tariff for all products to a maximum of 5 percent, why aren't we seeing an influx of products from our neighbours?
When cheaper products come in, then we have, in a way, lowered inflation. Of course, local manufacturers can go the other way by selling more to the other markets. In all fairness, Afta will be better for us than for the other countries.
Apart from Singapore, our economy is the second most developed in Asean. When taxes are lowered, it helps create a bigger market for more a complex and competitive industry, or for the so- called ‘infant industries’.
As our neigbours sell us more bags of rice, we might sell them more electronic items in return. This way, we are nurturing our electronics industry, and they are cultivating their agricultural industry.
This way, we move ahead with more advanced industries, the stuff that moves us up the value chain. As we might see it now, Afta is stalled hugely because our government is worried that Proton will be knocked out by Thai-assembled foreign cars.
Well, if it can't compete in a slightly bigger pool with just one or two more foreign brands, then there will never be a time when Proton can really compete. Opening up the door for more competition is just what Proton needs if it were to grow up.
We are not trying to vanquish Proton, but expand its cage into a bigger one called Afta.
We now charge a higher excise tax to make up for the lowered tariff. Therefore, Malaysian consumers are still paying a premium for Toyota models from Thailand. Being all pent up by Malaysia's action, Thailand is charging a 20 percent levy on Protons.
But hey, hold on a minute. Did you say just 20 percent? As we use excise duty to charge a 100 percent tax on an Asean-manufactured car, they are just charging us 20 percent. That's a shame, isn’t it?
Now, next time when you go to Thailand, try spotting Proton cars. If Proton can't survive Afta, then there is surely zero possibility of it surviving in the bigger markets.
The longer Malaysia drags it's feet, the worse our situation will become. Singapore is going around the world saying it is Afta-compliant. It is gathering more artillery ahead of Afta by telling the big guys to set up branches in Singapore.
And when the Afta is exercised, those big companies with bases in Singapore can flood the Asean market. Malaysia, too, should be doing the same by getting itself Afta-ready, instead of stalling the process.
Don't make the Afta dream a pipe dream. We need to be competitive. We need to start with Afta.
