Author: Adli Amirullah, Amirah Fazira and Ali Salman
Trade integration offers opportunities for economic growth. However, high domestic taxes, lax border enforcement, and supply constraints can lead to an increase in illicit trade flows thus, reducing benefits of trade openness. As Malaysia becomes more integrated as a result of existing and prospective free trade agreements, it also faces the risks of an increase in illicit trade flows barring significant domestic reforms.
