MPA is an industry association representing the petrochemical industry of Malaysia. MPA was formed in 1997 and is registered with the Registrar of Societies in Malaysia. At present, members of MPA include companies engaging in the manufacture and trading of petrochemicals and plastic resins, as well as companies providing services required by the petrochemical industry.

We would like to share the latest Market Alert prepared by MATRADE Taipei on China's Suspension of ECFA Preferential Tariff of Selected Petrochemical Products on Taiwan.

 

Background

On 21 December 2023, the Ministry of Finance of the People’s Republic of China (Mainland China) announced that it will suspend tariff relief on the importation of the 12 Taiwanese petrochemical products into China under the Economic Cooperation Framework Agreement (ECFA), effective 1 January 2024.

 

Both Taiwan and Mainland China signed the ECFA in June 2010, which functioned as a free trade agreement between Taiwan and Mainland China. Under the Agreement, both sides offered list of manufactured goods that allowed to enjoy preferential import tariff for the products ranging from agriculture, petrochemical, machinery, textile, logistics and transportation, and other industrial produce such as iron & steel, cement, color die, aluminum & copper, compressor, mini home appliance, and optical device such as cameras.


Under the ECFA, Taiwan used to enjoy preferential tariff for exportation of products to China with less than 2% import duty for the 12 items under petrochemical categories, and these include 1) Propene, 2) Buta-1, 3-diene, 3) Isoprene, 4) O-xylene, 5) M-xylene, 6) P-xylene, 7) Mixed xylene isomers, 8) Dodecylbenzene, 9), Chloroform 10) Vinyl chloride, 11) Ethylene-propylene copolymers in primary forms, and 12) Polymers of other olefins, in primary forms

 

With the fact that Taiwan is no longer benefit from the preferential tariff on petrochemical products under the ECFA, it is estimated that the Taiwanese petrochemical companies will have to bear extra cost of USD 529 million on the petrochemical produces exportation to Mainland China since the import tariff for the mentioned 12 items are now taxable between 2%-10%, from the previous preferential rate of 1% to 2%.

 

Export Opportunities for Malaysian Petrochemical Companies to Mainland China
According to the General Administration of Customs of the People’s Republic of China trade statistics, Mainland China’s total import for these aforementioned photochemical products was USD 13.56 billion for the period from January to November 2023. Korea, Japan, Taiwan, Brunei, Singapore were Mainland China’s top 5 import sources with the total import shares of 88.86%.

Malaysia ranked its 6th supplier with total import value at USD 463 million, accounted for 3.41% of Mainland China’s total import for the products consist of p-Xylene (HS 29024300), propene (HS 29024300), polymers of other olefins, in primary forms (HS 29029000), Buta-1,3-diene (HS 29012410) and ethylene-propylene copolymers, in primary forms (HS 29023010). Malaysia has a well-developed petrochemical ecosystem, with over 100 companies producing a wide range of petrochemical products, such as olefins, polymers, and aromatics, and to expand beyond the commodity products as industry players develop more complex, specialty downstream chemicals.

Malaysian petrochemical producers should seize the opportunities of China's suspension of ECFA tariff reductions of the selected petrochemical products on Taiwan. The petroleum and petrochemicals industry are one of the leading industries in Malaysia. From being an importer of petrochemicals, Malaysia today is in the top 10 list of sourcing countries of major petrochemical products. A wide range of petrochemicals are produced in Malaysia, such as olefins, polyolefins, aromatics, ethylene oxides, glycols, oxo-alcohols, ethoxylates, acrylic acids, phthalic anhydride, acetic acid, styrene monomer, polystyrene, ethylbenzene, vinyl chloride monomer and polyvinyl chloride, proofing Malaysia have the strengths and capacity in supporting global petrochemical demand supply chain. 

 

Click here to view the Market Alert report.



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On 12/5/2020 at 9.00 am saw a Donation Handing-Over of Face-Shields from Members of MPMA and MPA, to PPUM (Pusat Perubatan Univ Malaya). Recipient was represented by Professor Tan Maw Pin (Geriatric Medicine), PPUM.

MPA was represented by our Vice President Mr Philip Kong (also representing Lotte Chemical Titan Corp whom contributed 2.0mt of PP CoPo resins).

The contribution is most welcomed by PPUM's Front-Liners considering the regular imported Face-Shields are getting scarcier and costlier to procure from foreign suppliers.

MPMA Members (Northern Branch) jointly contributed an amount of RM55,700 in production costs, moulds,  die-cutting, pet shields and packaging, whilst Lotte Chemicals Titan's contribution is about RM7,000 of PP CoPo resins (for equiv 60,000 pieces of Face-Shields).

This exemplifies MPA Members' commitments to contribute our relevant roles in combating the Covid-19 menace in Malaysia.

The Asia Petrochemical Industry Conference (APIC) is an annual conference organised to promote mutual friendship and goodwill among the petrochemical industry players in the world, as well as the sound development of the petrochemical industry in the region.

Since its inception under its former name the East Asia Petrochemical Industry Conference (EAPIC) in 1979, the APIC has been a major forum that annually attracts participation of hundreds of senior corporate executives in the petrochemical industry. The conference is an effective venue, which facilitates exchange of information, sharing of issues, and promotes business networking.

The APIC is organised by its Steering Committee consists of 7 national organisations representing petrochemical industry of their respective countries.

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29 Aug 2024
08:00AM - 05:00PM
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PETROCHEMICALS SUSTAINABILITY CONFERENCE 2024