The Malaysian ministry for international trade and industry (MITI) has announced the introduction of several import measures to assist domestic producers meet the challenges brought about by developments in the global iron and steel industry, effective as of August 1.
According to a statement released by MITI, the Malaysian government has agreed to implement the following measures, in order to enhance competitiveness of the local industry, as well as encourage the manufacture of more competitive products for the international market:
1) Manufacturing licenses will be granted without restriction to meet the demand of domestic and export markets for long and flat products.
2) MITI will continue to issue free import licenses for flat products for monitoring and data collection purposes, while no export license is required for flat products. The current import and export duty exemption on 57 tariff lines of long products will be maintained. Import control for products of hot rolled coils (HRC), cold rolled coils (CRC) and electro-galvanized iron (EGI) through fixing the ratio between locally sourced and imported products will be abolished.
3) Import duties will be revised downwards for both long and flat products, effective August 1.
For long products, import duties will be reduced to 10 percent, to be further reduced to five percent from January 1, 2010. For flat products, the current import duty of 50 percent will also be reduced to 25 percent, and subsequently to between zero and 10 percent from January 1, 2018.
4) In addition, import duty exemption for flat products, including HRC, CRC and EGI, will be given to raw materials used for the production of finished goods for the export market, irrespective of local availability. Products for which grades and specifications are not produced locally for the local market and products used as raw material to produce nil duty finished goods will also be granted import duty exemption.
5) Steel service centers will also receive import duty exemption for products for which grades and specifications are not produced locally. For traders current policy will be maintained, where import duty exemption is not given to them.
6) Malaysia has also decided that the determination of the HRC base price by MITI will be abolished. This will allow the HRC price to be determined based on domestic and international market forces.
7) The Malaysian government has agreed to implement mandatory standards for imported and locally produced long and flat products to prevent the influx of sub-standard products into the country. These standards will be implemented in stages and will be effective from August 1 for iron and steel products which have Malaysian Standards. Enforcement of mandatory standards will be implemented by Malaysia's Construction Industry and Development Board, Department of Safety and Health and SIRIM QAS International.