Kuala Lumpur, 4 July 2018 – The government must press ahead with ratification of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) before its too late. The new pact, called the CPTPP, contains many of the original ideas of the TPP but suspends 20 provisions related to trade facilitation, investment, services, public procurement, intellectual property rights (IPR), environment and transparency. These suspended provisions followed the withdrawal of the US from the original deal and include many of the most controversial issues.
Malaysia is one of 11 countries in the newly minted CPTPP but it only takes 6 countries ratifying the agreement for it to come into effect. Mexico was the first to ratify and many are following quickly in its footsteps. Japan, Chile, Canada, New Zealand, Singapore, Peru, Vietnam, and Brunei are all expected to ratify soon. If Malaysia tries to reopen the agreement, it risks getting left behind.
IDEAS Economist Adli Amirullah said, “It is crucial for the new government to retain its commitment towards CPTPP. If the government casts doubt on the agreement and does not proceed, we risk being left behind from benefiting from the agreement. CPTPP is not the same as TPP and it will improve Malaysia’s business environment and transparency. “
“Retaining the commitment to CPTPP is a positive step forward for our position in the global value chain and will lock in important domestic reforms. Rapid ratification will send a positive signal to the world about Malaysia’s openness to trade. I hope that the newly appointed Minister for International Trade and Industry (MITI), YB Ignatius Dorell Leiking and the Deputy Minister for MITI, YB Ong Kian Ming will uphold Malaysia’s aspirations to be a country that is always open to fair trade in the world”
CPTPP will allow our businesses to have access to a market with a population of 500 million people. The CPTPP brings together Malaysia, Singapore, Brunei, Vietnam, Australia, New Zealand, Japan, Canada, Mexico, Chile and Peru, with a combined gross domestic product (GDP) of the 11 countries is US$11 trillion or 13% of the global GDP. According to Moody’s report on CPTPP, CPTPP will still boost exports and incomes for all members and help sustain reform efforts in a number of countries.
The CPTPP will also lock in domestic economic reforms in areas such as government procurement, intellectual property, market access for goods, and many more. With CPTPP, competition will become higher in the market and thus will create a healthier business environment in Malaysia. Removing technical barriers to trade and sanitary and phytosanitary measures was also part of CPTPP agenda and it is expected to generate more benefit in trading experience between the member states.