D-8 to Boost Intra-Trade, Enhance Economic Cooperation through 6th Summit KL

Kuala Lumpur, Malaysia | July 08, 2008 by D-8 Secretariat

The 6th Summit of Group of Eight Developing Islamic Countries (D-8) slated for July 7-8 has officially begun today. The theme of the Summit is “Meeting Challenges Through Innovative Cooperation.”

The opening of the 6th Summit of D-8 will be held on 8th of July 2008, where Prime Minister of Malaysia Datuk Seri Abdullah Ahmad Badawi will deliver the opening address followed by the handing over of the group’s chairmanship by President of Indonesia Susilo Bambang Yudhoyono to Datuk Seri Abdullah Ahmad Badawi.

However, to jump start the summit, a meeting of the senior officials appointed by their respective governments knows as the 25th Session of the Commission of D-8, was held on 4th and 5th of July 2008 in Kuala Lumpur. This was followed by the 11th Session of the D-8 Council of Ministers, which comprises ministers in charge of foreign affairs of member states, on 6th of July 2008 at the same venue.

Malaysia Hosted the 10th HLTO Meeting Of D8

Malaysia also hosted the 10th Meeting of High-Level Trade Officials of Developing Eight Countries (D-8) in Kuala Lumpur Hilton on Thursday last week. The meeting was held in conjunction with the 6th D-8 Summit.

The meeting, chaired by Malaysia, discussed the Rules of Origin (RoO) for the D-8 Preferential Trade Agreement (D-8 PTA) and the Operational Certificate Procedures (OCP) for the RoO for the D-8 PTA. The conclusion of the RoO and the OCP is necessary in order to implement the D-8 PTA. According to the statement, D-8 PTA, which aims to accord preferential tariff concessions on selected goods among the member states to improve intra trade, was adopted during the 5th D-8 Summit in April 2006, in Bali, Indonesia and was signed by all member states.

Trade Volume Among D-8 Members Set To Soar

Private sectors of the developing eight (D-8) countries should encourage their respective governments to ratify the D8 Preferential Tariff Agreement (PTA) on selected goods of member countries as they stand to benefit from it, Ministry of International Trade and Industry of Malaysia (MITI) deputy secretary-general (industry) Datuk Ooi Say Chuan said Thursday. The D-8 PTA will only enter into force when it has been ratified by at least four member states.

“To date, only Malaysia and Iran have ratified the D-8 PTA. Malaysia hopes more member states will ratify the D-8 PTA to enable its implementation,” he said in his opening statement of the D-8 business forum in KL, last week. In order for the D-8 PTA to be fully operational, member states should agree on the rule of origin and submit their respective lists of products offered for tariff concessions. With implementation of the PTA, exporters of the member states will gain competitive advantage over similar products originating from non-participating countries.

Private sectors, on the other hand, should also give inputs on issues that inhibit the growth of trade between developing countries. “(With such inputs) probably measures can be taken beyond the reduction of tariff,” he said.  Such initiatives can help complement PTA.

Along the similar lines, Datuk Syed Hussein Al Habshee, secretary-general of the National Chamber of Commerce and Industry Malaysia, was confident that the trade among D-8 countries could expected to increase by 25 per cent by 2020. Trade between the D-8 countries is reportedly above US$45 billion.

To achieve the PTA target, Syed Hussein urged business communities from respective countries to increase commercial activities and capture a bigger slice of the D-8 market which has a populace of over 900 million people. “We are expecting an annual growth of three per cent (and) we envisage to achieve a 20-25 per cent growth by 2020,” he said.

Syed Hussein expects manufacturing activities in sectors such as food, textile, electrical and electronics as well as oil and gas industries to drive growth in trade.

Syed Hussein also said D-8 leaders should show strong political will to realise the group’s goals in boosting regional cooperation in trade. “Leaders of D-8 countries should always look at and decide on projects that can be implemented and beneficial to member countries,” he said. “Since D-8 was incepted in 1997, we have to re-look at our achievements. This summit should have concrete resolutions which can be implemented and followed up and not projects which just look good on paper,” he said.

Soaring Oil Prices Among Main Issues Of D-8 Summit

The soaring oil prices was also among the top agenda of the 6th D-8 (Developing Eight) Summit. “We should bring this at the D-8, (and) in ASEAN, so that finally, the convergence of views would go towards suppressing surging oil price,” said Foreign Minister Dr Rais Yatim, who raised the same issue at the Organisation of the Islamic Countries (OIC) in Kampala, Uganda from June 18 to 20, as quoted by Malaysian News Agency, BERNAMA.

He also said Malaysia wanted to start the ball rolling in getting the world to discuss how oil producing countries could assume a more prominent role in determining the price of oil, instead of the speculators. Oil has risen about 40 percent this year, driven by expectations of strong demand from China and India, geopolitical tension in the Middle East, and speculators in the oil markets.

On Friday, oil prices topped US$142 a barrel. The Organisation of the Petroleum Exporting Countries expects prices to reach US$170 per barrel in the coming month. Rais said other issues to be discussed during the summit included democracy and its practices, justice, overlapping charters, bilateral relations and finding solutions to conflicts in various parts of the world. “The summit will also provide an opportunity for Prime Minister Datuk Seri Abdullah Ahmad Badawi to indicate the grouping’s direction,” he said.

Indonesian President Susilo Bambang Yudhoyono in expected to hand over the chairmanship of D-8 to Abdullah during the summit. The last summit was hosted by Indonesia, the current chairman of D-8, in Bali, Indonesia on May 13, 2006. The summit is held once in every two years. Malaysia will hold the chairmanship for two years before passing to another member country.

The 2008 summit is expected to adopt the decision on the setting up of the D-8 Permanent Secretariat and D-8 Roadmap for Economic Cooperation in the Second Decade of Cooperation (2008 - 2018).

D-8 Business Forum to Seek Way to Implement Expertise on Trade

D-8 Business Forum was also be held in Kuala Lumpur on 3 July, 2008 as a side event of the Summit. It is organized by the Government of Malaysia in collaboration with the National Chamber of Commerce and Industry. The Forum focuses on 3 sectors, namely Halal industry, biotechnology and renewable energy.

Bangladesh and Indonesia are keen to leverage on Malaysia’s expertise in developing halal standards and experience in the industry to develop the industries in their countries. To this end, Halal Industry Development Corporation (HDC) representatives has met government officials from both countries to discuss ways to develop the industry on the sidelines of the coming D-8 summit and related meetings beginning last week. HDC oversees the development of the halal industry in Malaysia.

“Each country has different requirements and is looking at Malaysia to help them develop this industry,” HDC’s chief executive officer, Datuk Jamil Bidin. He said both countries were keen to further develop their halal industries, more so given their large Muslim populace. Indonesia has about 240 million people while Bangladesh has 154 million.

Jamil said Bangladesh, for instance, was looking at developing its own halal standards for halal certification. He said Indonesia has an abundant supply of raw materials which could be used to produce halal food and products for export. “We want to find ways to cooperate with Indonesia by using their raw materials and process them into halal products,” he said. Jamil will be one of the panellists at the D-8 Business Forum tomorrow, which is held in conjunction with the Sixth D-8 Summit starting from July 4-8.

He is expected to talk about HDC’s role in steering the development of halal industry in the country and its new role as issuer of halal certification in domestic and international arena. Jamil will also talk on Malaysia’s position as an ideal halal reference centre for certification, training and research and development as well as on incentives for foreign investors.

D-8 Business Roadmap To Be Accepted At KL Summit

The 6th Developing Eight Countries (D-8) Summit will also adopt and accept a business roadmap placing emphasis on intra trade for implementation by all member states, D-8 secretary-general Dr Dipo Alam announced to the press. He said the business roadmap, which charts the trade direction for all member states for the next 10 years, would leverage on the rich natural resources and full potential of the eight Organisation of Islamic Conference (OIC) countries in an effort to boost intra-trade between the countries.

“The total trade of D-8 nations to the world reached US$1 trillion last year while intra-trade between member states was only US$60 billion. This accounts for only five percent to our trade to the world. There is potential for intra-trade to grow,” Alam said at the opening session of the two-day D-8 Business Forum which started Thursday last week. “This is especially so with some D-8 members being oil and gas producing countries. Our combined population is 930 million, so the market is there. Taking all these into account, we have come up with a business roadmap and it would be declared at this summit,” he said.

Alam said the roadmap was aimed at increasing intra-trade between members states from the current five percent to at least 10 to 15 percent. “We believe we can achieve this target taking into account the robust economic growth of member states. The roadmap will place emphasis on three areas,” he said. The three areas listed by Alam were the signing of preferential trade agreement, customs agreement and visa agreement between member states, all aimed at fostering better trade exchange between the eight nations.

“The preferential trade agreement will be the main vehicle of trade between member countries while the customs agreement will facilitate the movement of goods and the visa agreement enabling smoother travel of the business community from one member state to another,” he said. Alam said at the D-8 Summit next week, he would propose that nations which gained a windfall due to the soaring oil prices to share their profits with other developing member states hit by the current energy crisis.

“This needs political will and I would be making the proposal at the D-8 leaders summit next week,” he said. Alam was confident that Malaysia, due to take over the chair of the grouping at this summit from Indonesia, would be able to steer the D-8 to greater heights.

“My assessment is based on the consistency of Malaysia. It has the highest total trade among member countries. It proposed the development of the halal industry and initiated tourism agreements between member states. Malaysia has shown consistency and with the country taking over the chair of the D-8, I am confident that the grouping is in for better times,” he said.

News/photosource: BERNAMA News Agency.

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