TPP to position Malaysia as global investment destination
KUCHING: The Trans-Pacific Partnership (TPP) agreement is necessary for Malaysia as it continuously seeks new and greater market access for its goods and services by creating a more liberalised and fair global trading environment.
“FTAs (Free Trade Agreements) play a key role in regional integration. To ensure that Malaysia continues to gain market access internationally and remains an attractive location for foreign investment, we need to pursue bilateral and regional trading arrangements.
“This is one of the critical reasons why our government is actively pursuing the TPP,” commented Datuk Wira Jalilah Baba, president of Malaysian International Chamber of Commerce and Industry (MICCI) and chairman of Crewstone International Sdn Bhd.
Despite its controversies, Jalilah viewed the TPP as an important initiative for Malaysia to expand its market access opportunities, enhance its competitive advantage, and build investor confidence that will serve to attract foreign investment into the country and build capacity through FTAs.
“In addition to benefi ting the Malaysian companies that export to our FTAs partner countries, TPP offers a greater advantage to Malaysia as it covers nearly 40 per cent of the global economy and includes 12 countries,” she outlined in a statement.
“The TPP is expected to allow Malaysia to serve as a base of operations for foreign companies in non-TPP countries as well. As a member of TPP, Malaysia will also be able to participate as an important link in the whole regional supply chain.”
In the long run, the TPP is anticipated to bring benefi ts of lower cost of goods and more efficient production by taking advantage of the competition and economies of scale.
“With the TPP, Malaysia will be able to go on the offensive and take advantage of new international markets.
“We will also continue to be an integral part of the deepening economic integration taking place within the Asia Pacifi c region, and engage more tangibly with important trade partners such as the US, Canada, Mexico and Peru, with whom we currently do not have any structured framework or trade agreements.
“Just like the recently implemented FTA with Australia, which has enabled Malaysia to enjoy duty-free access into the Australian market, the TPP will offer opportunities for seamless markets with preferential access far beyond our population, opening up regional and global investment opportunities,” she said.
The successful conclusion of the TPP is anticipated to open an unprecedented market of 793 million people, with a combined GDP of US$27.5 trillion – far surpassing the limited domestic market of 29.5 million people and a GDP of US$300 billion in Malaysia.
Nevertheless, several sensitive and contentious issues remain on the table, including next- generation drugs, autos and dairy products.
Jalilah stressed that these issues will be addressed in due course and the government, through the Ministry of International Trade and Industry (MITI), is doing its best to protect the best interest of all parties.
“We commend MITI and its chief negotiators who continue to persevere and seek an optimal outcome for these ongoing trade talks.
“A cost-benefit analysis of the TPP deal will be presented to the public and the Parliament once ready. This analysis will ensure that the cost of implementing the TPPA does not outweigh its benefits.”
She added that a satisfactory conclusion of the TPP could pave the way for similar FTAs in future, such as the EU-Malaysia FTA.
“The TPPA is representative of modern trade agreement thinking, and as such, Malaysia should not shy away from measuring itself against this yardstick.
“Moving away from ‘developing nation’ towards ‘developed nation’ means relying less on preferences granted and more on competitive access to global markets – this is what the TPPA and future FTAs will bring.”
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