Panel 1

Panel Discussion

Panel 1

Date: October 9, 2019

Time: 4 pm – 5 pm

Venue: Universiti Teknologi Malaysia Kuala Lumpur

Digital Free Trade Zones – A New Opportunity for Promoting Trade?

In 2017, Malaysia and the world’s largest online retailer Alibaba launched a digital-free-trade-zone at the Global Transformation Forum. This digital-free-trade-zone (DFTZ) seeks to establish Malaysia as a leading logistics center for global market places by opening opportunities for companies both in Malaysia and other ASEAN countries. It should facilitate cross-border trade and enable local businesses to increase exports by reducing non-tariff barriers. Malaysia is supported to become a regional e-fulfilment centre as well as a regional hub for SMEs for inter- and intra-ASEAN trade. The hub especially features Alibaba-owned Lazada, Southeast Asia’s largest online marketplace, which is made up of a mix of small merchants and big-name brands. Consequently, there have also been concerns that DFTZ mainly prmotes imports from China and threatens the business of local SMEs in Malaysia. Furthermore, DFTZ strengthens the role of Alibaba and there are worries that the tech giant holds too much control over the process and will increasingly dominate e-commerce in Southeast Asia.