Hoo Ke Ping, who has published several books on international economics, noted that the partnership had not even started. “So I don’t see how it can affect Malaysia,” he said in an interview with FMT.
He speculated that Malaysia might enjoy better growth with the jettisoning of the TPP because it paved the way for the China-based Regional Comprehensive Economic Partnership (RCEP).
“The major issue with the RCEP is that there is nothing concrete yet,” he said. “They have yet to start with the framework for negotiations.
“However, with the RCEP, Malaysia will have bigger trade with China and India in the palm oil and petrochemical sectors.
“It is expected that there will be more growth through the RCEP than there would have been with the TPP.”
With China’s 1.3 billion people and India’s 1.2 billion, the RCEP covers a larger market size than the TPP’s 800 million people.
An official of the Institute for Democracy and Economic Affairs (Ideas) also weighed in on the subject, saying the US withdrawal meant that the TPP would now not affect Malaysia’s trade with China and India.
“Malaysia has been negotiating on the RCEP in parallel to and independently of the TPP agreement,” said Ideas external relations manager Azrul Mohd Khalib.
“Free trade agreements of any kind should be negotiated to benefit the country, regardless of whether it is TPP or RCEP.
“However, measuring how any trade agreement benefits Malaysia should certainly be more than just looking at the population of the countries that are part of the agreement.”
He said Malaysia should look at how much access it would have to the Chinese and Indian markets.
“Just because India has a population of 1.2 billion, it doesn’t mean that we will automatically be free to access that market,” he said.
“If countries restrict access to imports into their local markets, have high tariffs, negotiate carve-outs, and refuse to liberalise parts of their economy for fear of foreign competition, then we will benefit very little.”
Azrul said the Malaysian government should build on the progress it made in the TPP negotiations, particularly on its commitments to liberalising parts of the economy.
“These included new free trade agreement issues such as government procurement, competition, intellectual property, labour, and the environment.
“Implementing those commitments, irrespective of whether it is TPP or RCEP, will result in expanded market access opportunities, enhancement of Malaysia’s competitive advantage and increased investor confidence in the country, all of which would draw foreign investments and build capacity. We must not give all of that up.”
It was previously reported that Washington’s withdrawal from the TPP, which the US spearheaded during the Obama administration, had dealt a blow to Malaysia’s hopes of boosting its palm oil exports.
Plantation Industries and Commodities Minister Mah Siew Keong said Malaysia was looking forward to reaping the benefits of the TPP, including the reduction of tariffs on palm oil exported to the 11 countries of the pact.