IT is unclear how a Trans-Pacific Partnership (TPP)-style trade pact without the US can benefit Malaysia, said a major research house, as the country continues to pursue such a deal with regional neighbours.

Khazanah Research Institute (KRI) managing director Charon Mokhzani said special access to the US market for Malaysian companies was the prize of the TPP Agreement (TPPA).

“The US was the prize (in the TPPA). It’s not clear at the moment how different TPPA-11 would be compared with TPPA-12,” Charon told reporters in Kuala Lumpur today.

Under the original TPPA, called “TPPA-12”, Malaysia would gain special access to four new overseas markets, namely the US, Canada, Chile and Peru.

The trade pact, which encompassed 12 Asia-Pacific countries, including Malaysia, would have spanned 40% of the global economy.

In return, Malaysia would need to make major changes to labour, environmental and intellectual property laws, as well as in ways government-linked companies operate.

These changes, TPPA critics said, would have impaired the government’s ability in policymaking.

The US abandoned the TPPA after President Donald Trump was sworn into office in January this year.

The remaining 11 countries are currently pursuing the pact, now termed “TPPA-11”, without the US.

“It’s not clear at the moment what the benefits are if the US is not there,” said Charon after launching KRI’s latest report, titled “Why Trade Matters: Trade Issues in Non-Communicable Diseases, Essential Medicines and Education”.

“The big benefit from the TPPA was the increased trade with the US.

“With TPPA-11 without the US, we have to recalculate the benefits to Malaysia because one of the reasons everybody was excited about the TPPA was the access to the US market.”

In August, International Trade and Industry Minister Mustapa Mohamed had said the remaining 11 countries in the TPPA were still interested in pursuing the pact without the US.

They include Australia, Brunei, Japan, Mexico, New Zealand, Singapore and Vietnam.

Mustapa said the 11 nations were discussing ways to move forward without the US at this week’s Asia-Pacific Economic Cooperation summit in Vietnam.

“We believe that TPP has got some value even without US participation,” Mustapa was quoted as saying by Japan Times.

KRI research direction Junaidi Mansor said it was still too early to compare the benefits of the original TPPA with those of TPPA-11, as the terms for the latter deal were still being negotiated.

“So, we don’t know what the shift is going to be like at this point in time. It’s a bit premature to actually gauge what’s the outcome.”

KRI’s new report is the third in a series on trade. It explores the connection between trade policies, and health and education.

The report focuses on three main areas, namely how trade affects non-communicable diseases, access to essential medicines and education.

The book explains how trade policies can advocate healthier lifestyles by restricting products, such as alcohol and tobacco, as well as affect access to affordable and essential medicines.

Next year, KRI will publish a more detailed study on the different aspects of Malaysia’s trade, which will include policy recommendations for the government.

“The current one is for beginners. The next one is for practitioners. It will be 300 pages and very detailed about the different aspects,” said Charon.

Besides dealing with topics like intellectual property rights and tariffs, the book would also include a chapter on government procurement, he said. – November 8, 2017.