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World’s First Digital Free Trade Zone

By Diana Seow Wednesday, 19 December, 2018

The Digital Free Trade Zone will slowly but surely help Malaysia soar to greater heights.The Digital Free Trade Zone will slowly but surely help Malaysia soar to greater heights.

It has been more than a year since the launch of Malaysia’s Digital Free Trade Zone (DFTZ) in partnership with China’s e-commerce behemoth, Alibaba. It is regarded as a Belt and Road Initiative, also known as One Belt One Road, which is China’s development strategy that involves investment in Asia, Europe, and Africa. Since the inauguration, it has caused some concerns in the public, especially local business operators.

The move undeniably catapulted many businesses into e-commerce as it opened more doors towards favourable circumstances. But a big question mark remains hanging in the air, does the DFTZ comes with more pros or cons? With the DFTZ emerging, the local businesses are pushed up against Chinese firms, which will thrust local businesses into a highly motivated environment. When this happens, it will be a golden opportunity for the local businesses to learn as much as possible and incorporate that knowledge into their operations. It is normal to be a little sceptical at first as Malaysian e-commerce industry is still in baby steps but with experience, the observed and learnt skills will surely be helpful.

Southeast Asia, an e-commerce hotspot, is a battlefield for superpowers like China and the United States. Hence, some may think that the success of Alibaba ‘claiming’ Malaysia, a thriving e-commerce market, is one step closer to victory between their battle with Amazon. To be honest, regardless of the winner, the real benefiter here is us. With such passionate eyes and attention on us, it is bound to evoke competition on who will be providing us with greater support. Nonetheless, we can learn so much from both sides even from pure observation alone. Just imagine how much more that we can get if we were to be formally under the wings of either.

This major China-Malaysia infrastructure project is bound to boost trade between the two countries and the increasing said trade in the past year can be the evidence. Besides that, the platform is open to any organisations who are willing to make an investment. With that assurance, the concern of Alibaba being the monopoly can be put to rest. Through brick-and-mortar logistics in the heart of our country, a new gateway near to sea and airports is opened and this will, in turn, encourage cross-border trading with our nation’s e-commerce roadmap boosted.

DFTZ is expected to double the growth rate of Malaysian SME’s goods export with an estimation of US$65 billion worth by 2025 and creating a total of over 60,000 jobs both directly and indirectly. Only time can tell how much more is in there for us and the outcome, for now, seems to be getting positive and that’s a great sign. There are always two sides to a coin and everything comes with a price. Furthermore, there is no better time than now for Malaysia to finally free fall into the e-commerce industry. It is especially important now that companies all around the world take advantage of the Internet to boost and support their businesses. As the coming generations step up and possibly launching their own businesses themselves, they will have better opportunities with their tech-savvy nature. If the rate of innovation were to continue at this pace or faster, we are definitely on the right track to rise as a developed nation.

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