KUALA LUMPUR: Malaysia believes there is a need to revisit commitments to sustainable development, efficient global recourse and fair and balanced trade among countries, said the Ministry of Investment, Trade and Industry (MITI).
Its minister Tengku Datuk Seri Zafrul Abdul Aziz said countries must have shared values which will result in trade policies that can contribute to equitable and sustainable development.
“However, this should not be used as non-tariff measures to restrict trade flows. The proliferation of trade-related environmental measures such as the threat of environmental, social and governance (ESG) by developed countries is among the most important aspects of international trade,” Tengku Zafrul said during a meeting at the World Economic Forum held in Riyadh, Saudi Arabia.
Tengku Zafrul said the proliferation of trade-related measures has emerged as potential protectionist tools that could unfairly discourage global production and trade, particularly to developing countries.
“These measures can manifest as border instruments and compliance but they will undoubtedly be complicated and perhaps too costly for most developing country exporters,” he added.
Tengku Zafrul stressed that leaving the matter unattended could potentially erode developing and least developing countries’ trade competitiveness and investment attractiveness.
Citing a report by the World Trade Organisation, he highlighted that environmental goods and services face an average tariff of 4.3% along with numerous non-tariff measures.
“The cost of compliance, including certification, can be prohibitively expensive, especially for small and medium enterprises from developing nations.
“Such barriers necessitate a collaborative approach where developed countries not only impose these standards but also facilitate the means for compliance through technical and financial support,” he added.
Tengku Zafrul went on to say that in light of the complexities posed by ESG standards as non-tariff barriers and the significant need for capacity building and fair trade policies, a comprehensive approach is essential to ensure both environmental sustainability and economic justice, particularly for developing nations.
“Therefore, Malaysia supports and welcomes discussions on establishing effective multilateral rules on trade and sustainable development.
“Our commitment is evident through initiatives such as the New Investment Policy, New Industrial Master Plan 2023, National Energy Transition Roadmap and the ESG Industry Framework, which are all aimed at achieving sustainable economic growth,” he said.
— BERNAMA
