Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue 	: 	BUENOS AIRES, ARGENTINA 
Tarikh/Date 	: 	01/07/91 
Tajuk/Title  	:	ARGENTINIAN BUSINESS LEADERS 
			ORGANISED BY THE FOUNDATION OF 
			SCIENTIFIC AND 
			INTERNATIONAL STUDIES 




 Distinguished Guests;
Ladies and Gentlemen,
    First  and foremost, I wish to take this opportunity to
thank your Government for the invitation extended to me  and
my  delegation  to  visit Argentina.   As you are aware, the
first contact between the region and  Malaysia  was  made  a
long  time  ago  in the 16th century when the famous Spanish
navigator, Ferdinand Magellan reached the Far East by way of
South America in 1521.  A little known fact about Magellan's
epic voyage was that one crew member, Henry the Black, was a
Malay from the Philippines who was taken to Spain by Spanish
colonisers earlier.   Ferdinand  Magellan  or  to  give  his
Portuguese  name,  Fernao de Magalhaes, a Portuguese citizen
served under Afonso de Albuquerque in Malacca, Malaysia.  As
Magellan  died  in  the  Philippines  the  man   who   first
circumnavigated  the  world  was actually Henry the Black, a
Malay.   Juan  Sebastian  del  Cano,  who  took  over  after
Magellan  died  must be the second man to circumnavigate the
world.  Later on in the late 19th century, rubber trees from
this region were  introduced  to  Malaysia  and  since  then
Malaysia  has  been  well known throughout the world for its
rubber exports in terms of quantity, quality and  the  tech-
nology that Malaysia has developed in the production and ap-
plication of natural rubber.
2.   On  the  globe,  Malaysia  lies  on the reverse side of
South America with the huge expanse of the Pacific Ocean ly-
ing between us.  In the days of the sailing ships,  contacts
were  hazardous  and time consuming.  Fortunately today with
major advances and achievements in the field of  transporta-
tion  and  communication,  this physical distance between us
has been reduced considerably and, consequently it is easier
for people of our two countries  to  visit  and  communicate
with one another.
3.   I am delighted to note that trade between our two coun-
tries has shown encouraging growth in recent years.  Two-way
trade  between  Argentina  and Malaysia has grown from US$42
million in 1985 to US$144 million in 1990.  Growth in  trade
has  been  mutually  beneficial  as both imports and exports
have expanded.  At the same time, the composition  of  trade
has  also diversified to include new products such as wheat,
maize, animal feeds stuffs, oilseeds, automatic  data  proc-
essing  machines,  vegetable fats and oils, flat rolled iron
and steel, pipes and tubes of iron  and  steel  and  plastic
products  from  Argentina  and from Malaysia radio broadcast
receivers, telecommunication equipment, medical  instruments
and apparatus and textile and garments.
4.   Malaysia  has an open economy in which trade assumes an
important role.  Total exports amounted to US$29,400 million
in 1990.  The export sector contributes about 69 per cent to
the Gross Domestic Product of the country.   Malaysia  main-
tains trade relationship with all the countries of the world
including  countries  in this region.  It is my fervent hope
that our bilateral trade relationship will continue to  grow
strongly.  The large group of Malaysia businessmen in my de-
legation  is here to explore positively more economic inter-
action between our two countries.
5.   In the past, the Malaysian export trade  was  dominated
by   minerals   and   primary   commodities.     With  rapid
industrialisation the export of manufactured goods now  con-
tributes  about 60 per cent to exports.  Malaysia also main-
tains a substantial  import  trade  amounting  to  US$29,300
million in 1990.  They are mainly food, machinery and trans-
port equipment together with industrial machinery and compo-
nents for the manufacturing sector.
6.   In  the  past  5 years, Malaysia's total external trade
has increased at an average growth rate of 25 per  cent  per
annum.   As a result, total external trade more than doubled
from US$23,400 million to US$58,700 million  in  the  5-year
period between 1986 and 1990.
7.   In view of the importance of international trade to the
economy,  Malaysia  is  committed to an open economic system
and we wish to strengthen further our  economic  links  with
all  our  existing  trading  partners as well as develop new
ones.  Like Argentina, Malaysia is a member of  the  General
Agreement  on  Tariffs and Trade (GATT) and together we par-
ticipate actively in the Uruguay Round of Trade Negotiations
which was launched five years ago in Punta del Este.
8.   We are hopeful that the successful  conclusion  of  the
Uruguay  Round  will  eventually  result  in  a more liberal
international trading regime.  The Uruguay Round has entered
its fifth year of  negotiations.    Though  there  had  been
hitches  which  have slowed down the negotiations, there are
now however, positive indications that  participating  coun-
tries  are  willing  to return to the negotiating table with
renewed commitment and political will, to bring the Round to
a successful conclusion.   Malaysia  as  a  trading  nation,
small  though  it  may  be, will do its utmost to contribute
positively to the successful conclusion of the  Round.    In
this  regard,  our commitment is reflected in our efforts to
liberalise further our import regime consistent with a  more
liberal  trading practise.   Liberalisation inter-alia would
take the form of tariff reduction and deregulation  in  eco-
nomic activities.
9.   As  part  of  the  process to facilitate the successful
conclusion of the Uruguay Round,  Malaysia  is  already  ac-
tively  involved  in  cooperation with like-minded groupings
such as the Cairns  Group  and  G  15  which  also  includes
Argentina.   In our efforts to strengthen multilateral coop-
eration, Malaysia is also active in promoting regional coop-
eration.  At the regional level, the  Association  of  South
East  Asian  Nations  (ASEAN) of which Malaysia is a member,
has made much progress in the field of trade and  industrial
cooperation.  Intra-regional trade has been enhanced through
the  ASEAN  Preferential Trading Arrangement (PTA) while re-
gional industrial cooperation  is  facilitated  through  the
ASEAN Industrial Joint Venture (AIJV) programmes.
10.  At  the  East Asian regional level, Malaysia has initi-
ated the formation of the East Asia Economic  Group  (EAEG).
The  EAEG  is  not  intended to be a closed trading bloc but
merely a forum for East Asian countries to defend  the  free
trading system.  It also has the objective of enhancing eco-
nomic cooperation among East Asian countries.  The ASEAN ex-
perience  has  shown that neighbouring countries can learn a
lot from each other and can  help  each  other  to  develop.
When  neighbours  develop together their intra regional eco-
nomic activities are enhanced for the benefit of all.   Poor
neighbours  create  problems  particularly  in  terms of mi-
gration.  Their markets too cannot  contribute  towards  re-
gional  trade.    Poor  neighbours  will  consequently stunt
regional growth.  The EAEG by keeping free trade  alive  and
helping  each  other's  growth  is expected to have the same
catalytic effect on East Asian countries as ASEAN had.   The
countries of the EAEG will be free to trade with the rest of
the  world.   As collectively it will be a massive market it
will benefit countries outside the region as  well.    World
trade will therefore benefit from the formation of the EAEG.
11.  We  note  that the countries of South America have also
intensified their efforts in enhancing regional  cooperation
by  setting  the  time frame for the operation of the Andean
Pact and the MERCOSUR.  We view these  regional  cooperation
programmes positively as they seek to enhance trade and eco-
nomic  cooperation along accepted multilateral trade princi-
ples embodied in the GATT.  Apart from these developments in
regional cooperation, there are also other developments tak-
ing place in the developed world such as  the  formation  of
the Single European Market and the North American Free Trade
Agreement (NAFTA).
12.  In the interdependent world that we live in, developing
countries  such  as ours are greatly dependent on the devel-
oped world for trade and investment.   The  developed  coun-
tries  however have their own regional groupings and, at the
same time, their own  economic  imperatives  which  tend  to
spill  over and adversely affect us.  We hope that they will
set a good example for the developing countries by structur-
ing their regional groupings and finding solutions to  their
problems  in  ways  which are consistent with the free trade
principle.
13.  While the developed world is important to the  develop-
ing  countries as a market for their products, we should not
forget the tremendous potential benefits that could  be  de-
rived through greater South-South cooperation and trade.  It
must  be  remembered that developing countries are good mar-
kets for the developed north.  They surely can be good  mar-
kets  for the countries of the south as well, if only we can
get our act together.  Therefore in our quest  for  economic
development,  cooperation  among  the  developing  countries
should merit priority attention also.   Vast  potential  and
opportunities  for  the  furtherance  of  economic and trade
gains exist in the developing world.
14.  This is so because firstly, most countries of  the  de-
                        _______
veloping world have large population as well as abundant re-
sources.    Large population even when the per capita income
is low, provide a good market for  numerous  essential  pro-
ducts.    Secondly,  many  of  the  developing countries are
          ________
achieving high growth rates which will  enhance  their  pur-
chasing  power and market demand.  Hence, we should be posi-
tive that greater  cooperation  among  developing  countries
would be mutually beneficial.
15.  In this regard, we are hopeful that South-South cooper-
ation  will be further intensified.  The purpose of my visit
here with a large delegation is to meet with  political  and
business  leaders and to identify and pursue common areas of
interest.  I am confident that we can all  succeed  in  this
effort  in  view  of  the common goals that we have.  We are
members of the Group of 77 and of GATT and we have high  ex-
pectations  on  the Uruguay Round of Trade Negotiations.  In
these activities, we share common aspirations to achieve and
accelerate economic development in the context of a  liberal
trading  environment to give our people a higher standard of
living and a better quality of life.
16.  The enhancement of economic relations between  our  two
countries encompasses several areas in trade and cooperation
in  the  services  sector.   In this respect, Malaysia looks
forward with confidence to increase  trade  with  Argentina,
both  imports and exports.  To facilitate this, we have con-
cluded an Economic, Trade, Scientific and  Technical  Agree-
ment  between  our  two  countries.    We  are exploring the
possibility of concluding a Bilateral Payments  Arrangements
to facilitate payments for trade transactions.
17.  As  mentioned earlier Malaysia has a large agricultural
sector comprising rubber, palm oil, cocoa as well as a large
and growing manufacturing sector and their requirements con-
stitute a significant potential market  for  Argentine  pro-
ducts  such  as  the  supply of fertilizer to the plantation
sector, fish meal and animal feeds, minerals such as  copper
and  iron  ore, and steel products to the manufacturing sec-
tor.  With the growing per capita income and a  liberal  im-
port  market,  Malaysia  need  substantial imports of wheat,
beef, canned foods, fruits, seafood, machinery and  consumer
goods.    I am happy to note that some of these products are
already being exported by Argentina to Malaysia.
18.  In return, Malaysia can supply agricultural raw materi-
als such as rubber and cocoa, petroleum and industrial  com-
ponents such as rubber thread and masterbatch; stearic acid,
yarn and fabric, telecommunication apparatus, electronic and
electrical  components,  to meet the needs of the industries
in Argentina as well as palm oil, consumer products and  au-
tomobiles.
19.  Another potential area for economic cooperation between
our  two  countries which can be explored further is invest-
ment.  Malaysia has a liberal and  attractive  programme  to
attract foreign direct investments, both in terms of capital
and  technology.  Foreign investors find that investments in
Malaysia give them a competitive edge in  world  markets  as
well  as access to the burgeoning markets of South East Asia
and East Asia.  The availability of numerous  raw  materials
and  reasonable as well as highly trainable labour force en-
sure profitability.
20.  For Argentinian industries wanting to sell  commodities
or  manufactured goods to East and South East Asia, Malaysia
provides a depot and base for rapid and  efficient  distrib-
ution  to  the  countries in the region, as otherwise direct
shipments from Argentina would be costly and infrequent  due
to  shipping constraints.   Malaysia especially welcomes re-
gional headquarters and offer incentives to them.    Company
executives  enjoy  a  good  life in Malaysia because of good
communication, low cost of living and  the  availability  of
food  and goods from every corner of the globe.  I might add
that the annual inflation rate is between 2  to  4  percent.
Most luxury items enjoy tax-free status.
21.  Malaysia also pursues an active policy of privatisation
since 1981.  The private sector is welcome to acquire or buy
shares  in companies which take over many Government monopo-
lies and functions.  In this privatisation  programme,  par-
ticipation  by  foreign investors is also welcome especially
when they can contribute technology or expertise.    In  any
case  as  such  companies  are listed on the stock exchange,
foreigners and foreign institutions can buy and sell  shares
in a booming capital market.
22.  Our  achievements  made in the plantation sector and in
recent years in the development of the manufacturing  sector
has  enabled Malaysia to develop expertise in manufacturing,
plantation   management,   construction   and    engineering
consultancy.  We are ready to cooperate with the Argentinian
business  community  in  these sectors as has been done with
many other countries.
23.  I am heartened by the  tremendous  potentials  for  the
strengthening of bilateral cooperation over a broad range of
economic activities.  While Government can provide the envi-
ronment  and  conditions conducive to such a development, it
is for the private sector of both countries to get the busi-
ness moving.  In this regard, I am confident that there will
be concrete discussions on business opportunities among  the
business leaders of both countries and follow-up action will
be  taken  to  translate the business potentials into actual
business transactions and projects on the ground to increase
the commercial flows and investments between our  two  coun-
tries.