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SEOUL: South Korea has proposed to Malaysia to have a dedicated free trade agreement (FTA) with that country, Deputy Prime Minister Tan Sri Muhyiddin Yassin said today.
He said the suggestion was made by South Korea Prime Minister Kim Hwang-sik in a move to enhance and boost bilateral trade between the two trading nations.
"Eventhough South Korea has many trade and investment linkages through the Asean FTA, they feel a dedicated Malaysia-South Korea FTA will be better.
"It will enable South Korea to complement whatever existing facilities, be they in the form of market taxes and market access because Malaysia promises a huge potential for the republic," he told reporters after calling on Kim and meeting 18 captains of industry here.
Muhyiddin said he had agreed in principle to Kim's suggestion but a final decision would be made next month.
Currently, South Korea does not have a specific FTA with Malaysia, except the joint FTA with Asean, encompassing all the 10 members in the regional grouping.
Muhyiddin said South Korea sees Malaysia as a potential nation to expand its market not only bilaterally but also for third country market access whether through Asean or around South East Asia.
"They (South Koreans) see Malaysia has a country with vast potential given the stable economy and Malaysia's open economy policy.
"In fact, they also make comparison with China where the costs have escalated sharply whilst in Malaysia, the costs are quite stable. This is an attraction and a plus factor to investors from that country," he said.
Muhyiddin said following his meeting with owners of multinationals from South Korea, RM3 billion worth of new investments would flow into Malaysia over the next few years.
Muhyiddin said the Hana Group was planning to make a huge investment in the banking and insurance services sector in Malaysia.
He said a decision would be made soon.
"In my meeting with South Korean captains of industry, almost all of them have invested (in Malaysia) and expressed interest to increase their existing investments in Malaysia.
"For instance, Kiswire, a major copper wire producer in South Korea, will make a RM1.8 billion fresh investment over the next few years," he said.
Muhyiddin, who was instrumental in bringing the company to Malaysia when he was then Johor Menteri Besar, has been given the honour to declare open Kiswire's research and development centre in Johor Baharu next month. -Bernama