Malaysian automotive industry will not be adversely affected by the signing of the Malaysia- Japan Free Trade Agreement (FTA), Malaysian International Trade and Industry Minister Datuk Seri Rafidah Aziz said in Kuala Lumpur Saturday.

Rafidah Aziz told reporters on the sidelines of the 2005 ASEAN Business and Investment Summit held at Shangri-la hotel that she had discussions with the heads of local automakers who said they would not be hurt by liberalization of the sector.

"We have talked to Proton and they said even with or without Japanese cars coming to Malaysia, they have to buck up," she said.

Proton Holdings Berhad is a state-run auto-maker in the country.

She commended the present management team of the national car maker, Proton Holdings Berhad, for having a positive view and being objective in moving forward.

"They don't believe in competing in our own market because it is so small. There are so many avenues outside. So, that's what they are doing and we are pleased with that," she said.

On the outcome of the Malaysia-Japan FTA scheduled to be signed next week, the minister said: "Now that the parameters are being broadened, the private sector must quickly prepare themselves to enter the Japanese market."

The FTA, she said, is a "win-win" situation.

She said the FTA fell under the Comprehensive Economic Partnership (CEP) agreement with Japan that included Japan sharing its expertise, experience and technical assistance to set up automotive testing facilities, and providing assistance in small and medium scale enterprise development.

Proton's main plant in Shah Alam, with an area of 923,900 sq meters, is capable of producing 240,000 vehicles per year.

Source: Xinhua