Inland cross border trade & logistics / Noor Zahirah Mohd Sidek

The sustained positive growth of the world economy is accompanied by accelerated growth in global trade where countries tend to have higher rates of growth in trade as a share of national output. A host of studies have shown how trade liberalization policies have promoted firm-level productivity and economic growth (see for example Frankel & Romer, 1999; Alcala & Cicone, 2004). Malaysia and Thailand has been active trade partners and neighbours over the years. In 2018, trade between Malaysia and Thailand had increased by 17 percent vis-à-vis 2017 to USD21.9 billion. Exports from Malaysia to Thailand between January to May 2019 stood at RM25.41 billion or USD6.17 billion which is equivalent to 6.3 per cent of total import. Import from Malaysia to Thailand accounts for approximately RM19.32 billion (USD4.69 billion) or 5.5 per cent of total imports. In the case of inland cross border trade, logistics play a core role in the transportation of cargo from one node to another, supporting processing of economic transactions especially when dealing with customs and immigration departments prior to benefiting from the trade in terms of economic growth and development. Inland cross-border trade flow through the northern Malaysia-Thailand border is estimated to be over 20 percent of the total Malaysia-Thailand trade. With growing trade over time, both Malaysia and Thailand must ensure continuous improvements in implementable policies especially on logistics, customs and immigration.