Digital Free Trade Zone begins operations in October

May 13, 2017

The Digital Free Trade Zone (DFTZ) will start operations in early October, six months after the launch the Alibaba iCloud e-commerce platform.

For a start, 1,500 small and medium enterprises (SMEs), with suitable products, will be chosen by the Malaysia Digital Economy Corporation (MDEC) to participate in an online cross-border trade.

Prime Minister Najib Razak announced this to Malaysian journalists yesterday in Beijing upon arrival from Hangzhou, where he met Alibaba Group Founder and Executive Chairman Jack Ma and was briefed on the operations of Alibaba, the largest e-commerce giant in China.

With the start of the operations, the DFTZ will be first digital free zone of its kind outside China that is set to boost the growth of cross-border e-commerce by creating access to the hub of the city of Hangzhou in order to make inroads into China’s market.

The Prime Minister said a regional eFulfillment hub would be set up in Malaysia in October, with Alibaba housing the Alibaba iCloud platform for a bigdata platform for Southeast Asia.

Najib said he had invited Jack Ma, who is also the Malaysian government’s digital economy adviser, to participate in the launch of the hub in October.

The Prime Minister said Jack Ma was amazed with the speed and commitment of the Malaysian government in making the decision to set up the DFTZ a reality.

The DFTZ was launched three months after the initiative was first discussed and another six months for it to begin operations in October.

“He (Jack Ma) is so positive about Malaysia because he kept on repeating that he’d got my agreement within 10 minutes to agree on the DFTZ.

“And I’d committed as well to make it a reality within three months and we did that,”‘ Najib said, adding that Jack Ma had also described the Malaysian government as a “super-efficient government.

“That’s a good testimony of somebody’s assessment about the Malaysian government’s ability to be very responsive and business friendly,” he said.

The Prime Minister said the DFTZ was launched with various incentives offered to help small businesses expand their markets, mainly to the Chinese market.

While in Hangzhou, Najib witnessed the signing of an agreement between MDEC and the Hangzhou Municipal Government, as well as Alibaba (China) Company Limited, which is a partnership on an e-commerce platform like the Electronic World Trade Platform (eWTP).

The eWTP platform is the brainchild of Jack Ma and Alibaba in the quest to reduce trade barriers to facilitate SME involved in global trade.

On Alibaba iCloud, Najib said among the locations considered for it was Cyberjaya.

“The potential (of DFTZ) is enormous. I think the sky is the limit. Once we get this partnership going, and with so many things that we can do with Alibaba, it is just awesome,” Najib said.

Najib also presented an MSC (Multimedia Super Corridor)-status certificate from MDEC to Alibaba Cloud. (This resulted from the setting up of the DFTZ to spur online business, chiefly to China)

Najib said trade opportunities with China were huge as Malaysian companies kept receiving orders, including durian.

He said that through the cooperation with Alibaba, the tourism industry could be strengthened to attract more tourists from China.

“So far this year we have we achieved a significant increase of over 21% or 2.1 million tourists from China, while our target for this year is approximately three million Chinese tourists,” he said, adding that of them, over 200,000 made their bookings through the Alibaba platform. –Bernama