Preferential Trade Agreements and Trade Liberalization Efforts in the OIC Member States
With Special Emphasis on the TPS-OIC
134
Table 24: Simple Average and Preferential Tariffs Applied by Pakistan and Malaysia
Reporter Partner 2007 2009 2012 2015
Pakistan Malaysia
World (MFN) 14.16 14.14 13.5
Malaysia Pakistan 3.24 2.08 1.95
World (MFN) 7.2 6.95 6.5
World (applied tariff) 5.6 4.91
Source: WITS (TRAINS database-aggregated from 6digitdata).
MFN preferential tariff calculated based on Malaysia-Schedule of Tariff Commitments published at
cc529ea7&rootid=com.tms.cms.section.Section_8ab48a0a-7f000010-72f772f7-4dc62890 [accessed 8 May
2014.]
Preferences apply for products wholly obtained or produced in partner country or those for which
value added among FTA signatories exceeds 40% or the tariff heading (HS 4 digit level)
changes. Several products, such as agriculture products, textiles, and machinery must meet
product-specific rules to qualify for preferential treatment.
The relative importance of bilateral trade is low, especially for Malaysia where exports to
Pakistan account for around 1% of the total, up from 0.5% in mid-2000s. As noted above the
rise in palm oil exports to Pakistan during 2008-2012 (and consequently of the whole bilateral
trade) can be tentatively linked to the agreement given that Pakistan offered some margin of
preference relative to the prevailing applied MFN36.
While Malaysian exports to Pakistan are quite concentrated, Pakistan’s exports to Malaysia are
more diversified with several agricultural products (maize, rice, some vegetables, fish) and
various textiles and clothing products playing the most important role. Over time Pakistan’s
exports to Malaysia have become somewhat more concentrated (Figure 58).
36 Information provided at [Accessed on 8 May 2014].