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"We made clear to the Malaysian
government the requirements of our Trade Promotion Authority and that, at this
point, submission of a US-Malaysia FTA under the current TPA statute is not possible,"
Steve Norton, spokesman for US Trade Representative Susan Schwab, said in a statement
yesterday.</P><P>Bush loses his TPA power, which allows deals to be fast-tracked
through the Democratic-led Congress, at the end of June. That gives US negotiators
up to March 31 to present a deal for a mandatory 90-day congressional review.</P><P>The
Bush administration is moving rapidly to forge an free trade agreement with South
Korea before the end-March deadline, with last-minute talks scheduled in Seoul
next week on sensitive areas such as agriculture, automobiles and pharmaceuticals.</P><P>If
a deal is concluded with South Korea, it would be the biggest FTA since the 1993
North American Free Trade Agreement linking the United States, Canada and Mexico.</P><P><B>More
transparency</B></P><P>The Malaysia pact got bogged down within the government
of Prime Minister Abdullah Badawi, in particular over Malaysia’s affirmative action
policy that provides special privileges to indigenous ethnic Malay-owned firms.</P><P>While
some state contracts are open to competition from foreign companies, Washington
wants more transparency in the bidding process.</P><P>"Transparency is a
critical component of some of the contentious issues and the US is basically asking
for legal safeguards and clearer rules, especially as the affirmative action policy
is without a deadline," said a diplomat familiar with the negotiations.</P><P>Despite
the failure to meet the deadline with Malaysia, Norton said the United States
and its 10th largest trading partner had agreed to forge ahead with talks.</P><P>A
Malaysian team is scheduled to come to the United States in mid-April for consultations.</P><P>"We
look forward to concluding a high-quality, comprehensive FTA, and obtaining legislative
approval of such an agreement," the spokesman said.</P><P>The two sides launched
their talks about a year ago and Norton said "significant progress has been
made toward conclusion of such an agreement, but a number of important issues
remain outstanding."</P><P><B>Necessary step</B></P><P>After the last round
of talks, Malaysian officials informed Washington that they needed time to seek
a political consensus within their cabinet on how to proceed on issues such as
the affirmative action regime.</P><P>"Resolution of that process is a necessary
step before the negotiations can continue," Norton said.</P><P>"As we
have stated repeatedly, however, substance, not timing, is the determinative factor
that will guide our participation in these negotiations."</P><P>Any agreement
secured after the March 31 deadline would make congressional approval a complex
exercise.</P><P>Bush’s fast-track authority forces Congress to vote on deals quickly
– it must hold straight yes-or-no votes, without the option for lawmakers to file
amendments.</P><P>Asked about the fate of a Malaysia-US deal secured after March
31, Norton said: "It is impossible to speculate what Congress will do with
regard to TPA." – AFP</P>
<P><I>Source: http://www.malaysiakini.com/news/64984</I>
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