Reference no: EM132941456

Malaysia's National Automotive Policy (NAP) was introduced in 2006 and revised in 2009 and includes both tariff and non-tariff policies, which makes the cost of imported vehicles much higher than those locally produced. Some of these policies include complicated import procedures, imposition of excise duties, government supported supplier programs to Proton and special tax provisions which encourages vehicle production with Malaysian-manufactured components. NAP also encourages domestic vehicle production by lowering taxes on locally assembled vehicles and by using the country's industrial adjustment fund to provide support for the domestic content in vehicles because of the local content requirement mandated by the Malaysian government.

-Question: Evaluate the effectiveness of the National Automotive Policy in conferring comparative advantage to Malaysia in the automobile industry within the ASEAN region. ( Please explain the critical discussion of Malaysia's comparative advantage in the automobile industry in ASEAN supported by literature)