Measuring the Possible Impacts of MAFTA

Feb 2005 report

This study assessed the possible economic implications at the macro and sectoral level of a free trade agreement between Australia and Malaysia (MAFTA) using two global general equilibrium economic models (GTAP and APG-Cubed). The findings suggest MAFTA will lift economic growth and welfare in both Australia and Malaysia and that total gains in welfare for both Australia and Malaysia are maximised if the free trade agreement was to be implemented immediately rather than over a 5 or 10 year phase in period. These findings are premised on the FTA comprising of the complete removal of tariffs on bilateral trade, partial liberalisation of service trade, and gains in dynamic productivity associated with the trade liberalisation.

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