TPPA still needs explanation
The Trans-Pacific Partnership Agreement (TPPA) is finally finalised after long and arduous negotiations.
However, more explanations and clarifications are necessary to garner national support. The setting up of an operations room to answer queries was therefore an innovative initiative on the part of the government.
Minister for International Trade and Industry (Miti) Datuk Seri Mustapa Mohammed and his dedicated officials deserve our congratulations for optimising Malaysia’s gains in the newly minted agreement, despite tough talks.
Indeed, many analysts were surprised that Malaysia succeeded in getting so many carve outs, or deep concessions and exclusions.
For instance, 30% of government procurement has been set aside for bumiputra contractors for construction services.
Bumiputera suppliers and manufacturers would also continue to enjoy the price preferences for goods and services.
Thus, it was understood that the status quo for bumiputera will largely remain. This was in doubt before and had caused a lot of opposition to TPPA.
However, it would have been preferable if these liberal concessions were also made available to all small medium enterprises (SMEs) regardless of race,with greater priority given to bumiputera. TPPA should not be seen as racially biased.
Prof Joseph Stigltz who consistently opposesd TPPA had said that Malaysian negotiators were giving away too much of the country’s business interests. The reality appeared to be on the contrary now.
Stigltz also quoted a United Nations report that forecasted Malaysia to be a net trade loser by joining TPPA by about US$17 billion (RM73 billion) a year. There are doubts on the accuracy of these quick UN projections now.
There have also been serious doubts raised about the Investor-State Dispute Settlement (ISDS) mechanism. ISDS allows foreign companies to sue host governments if they think the host country’s laws can harm their company profits.
Again, the ISDS cannot be so arbitrary in its judgements and go against the very principles of international jurisprudence in the future.
Surely, the ISDS will have to take into account world legal opinion.
TPPA is against capital controls. However, if there were national legal provisions already in place, could they be challenged?
Similarly, will the intellectual property rights cause medicine to cost unnecessarily more?
It is clear that there are still major concerns as to the fairness and equity of TPPA. Will it be fair and just to the rich and poorer countries, or will the powerful countries use TPPA to bully and dominate, or even “colonise” us , as warned by the ideologues and alarmists?
The government’s challenges are therefore to be open, honest and transparent. It also has to convince Malaysians that we have a fair deal.
There is however considerable consensus that Malaysia will benefit greatly from the huge market and easy access we will gain from TPPA.
Most importantly, as Mustapa has pointed out, TPPA would encourage us to become much more competitive.
We will also not be left behind in our race to break out of the middle income trap and become a developed nation by 2020 on a sustainable basis.
The world will understand better our internal economic policies. This openness and global monitoring will enable Malaysia to transform at a faster pace and compete more effectively.
Of course, in negotiations, no country can afford to win everything and not give up something.
There has to be some give and take in any negotiation. Even in the United States, there are critics who accused the US of selling out to its own large corporations and to foreigners like us at the expense of its own citizens.
Some of our own parochial and short sighted businessmen who do not like competition are also resisting TPPA.
They should be grateful for the carve outs that Miti has won for them. This is unfortunately something not easily appreciated by some of our self-centred businessmen who obviously have powerful influence and backing.
It appears that Malaysia has struck a good deal in TPPA under the challenging circumstances. We still need to better understand the details, nuances and full implications of TPPA.
Thus I hope that Mustapa and his team will explain and clarify more on the many questions that have and will be raised.
This is necessary to make sure that the government gets maximum support for TPPA and for it to be well received by most, if not all Malaysians.
Lets ensure TPPA survives for our trading nation to thrive.
Article published in Free Malaysia Today and The Malaysian Insider.