This article first appeared in The Edge Financial Daily on February 9, 2018

KUALA LUMPUR: International Trade and Industry Minister Datuk Seri Mustapa Mohamed has dismissed the notion that the implementation of the Digital Free Trade Zone (DFTZ) with Alibaba as its digital platform, will result in an influx of Chinese products into Malaysia.

He said the DFTZ was launched to boost the participation of Malaysian companies, especially small and medium enterprises (SMEs), in the export market, not only to China but also to the rest of the world.

“This perception about Alibaba resulting in our SMEs being challenged by the influx of Chinese products is not correct,” he told a press conference at the Malaysia Digital Economy Forum yesterday.

“Also, Alibaba is not only penetrating the Chinese market, which itself is a big market with 1.4 billion people, but Alibaba is also exporting to other countries,” he added.

Mustapa said this was proven by the Malaysian companies which were honoured at the forum for their successes in penetrating markets such as the US, Saudi Arabia, India and Vietnam after joining the DFTZ.

Malaysia Digital Economy Corp chief executive officer (CEO) Datuk Yasmin Mahmood said the exports of these companies were not restricted to China as Alibaba was a global platform.

“They are able to expand into the US, Europe and of course, Southeast Asia.

“For this year, we are looking at expanding DFTZ to beyond just Alibaba [as the online platform]. We are looking at Lazada with the focus on exporting to Southeast Asia markets. We are also working with other online platforms like AladdinStreet and 11street [to achieve this],” she added.

Yasmin said Alibaba founder and executive chairman Jack Ma had committed to host a Malaysian week on the platform to further promote Malaysian products to a global audience.

“There is a strong commitment from Alibaba, even all the way from Jack Ma personally, who has committed to our prime minister during the launch last year, that they will host a Malaysia week on the Alibaba platform. They are going to promote everything [Malaysian] for one week this year,” she said.

Malaysia External Trade Development Corp CEO Dr Mohd Shahreen Madros said DFTZ would be a catalyst to increase SMEs’ contribution to Malaysian exports to 23% or more by 2020 from 18.6%.