MALAYSIA will have to ratify two pending free trade agreements (FTA) in order to re-position itself as an attractive business hub, prevent the outflow of foreign direct investment (FDI) and attract more high-quality investments from abroad, said Ong Kian Ming.

The former deputy international trade and industry minister stressed that this was why it was important for the government to ratify the Regional Comprehensive Economic Partnership (RCEP) and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) as soon as possible.

Saying that he was speaking in his personal capacity and not on behalf of DAP or Pakatan Harapan (PH), Ong said the focus should be on ratifying the FTAs if the government was serious in its efforts to increase FDI and external trade on a longer and more sustained basis.

“Ratifying the agreements will send a strong signal to the international community that Malaysia is indeed open for business and is serious in its efforts to attract FDI.

“This will also strengthen Malaysia’s own industrial base, with complimentary domestic policies such the National Policy on Industry 4.0,” said the Bangi MP from DAP.

He noted that the Ministry of International Trade and Industry had said that Malaysia would ratify RCEP by the end of this year.

He said that Singapore has already ratified RCEP earlier this month, and that RCEP will come into force 60 days after six Asean ASEAN member countries and three non-Asean member countries have ratified the agreement.

“I have confidence that the responsible and hardworking officers at MITI will do the necessary to get this done.”

“The sooner RCEP enters into force, the sooner the players in Malaysia, both local and international, can enjoy the benefits of RCEP from a trade perspective in areas such as greater uniformity and clarity on the Rules of Origin classification,” he added.

He also urged Senior Minister and Minister of International Trade and Industry (MITI), Mohamed Azmin Ali, to push for the ratifying of the CPTPP, which the latter had said would be done but had not set any deadline.

Ong said the minister must be bolder in his approach, adding that the country was in an important and significant political and economic crossroads.

“If Malaysia could go through the challenging process of amending and updating our domestic legislation, which includes improved labour and environmental standards) in order to ratify the CPTPP, this would not only help Malaysian industries and the workers in these industries.

“It would also send a very strong signal to the international business community that Malaysia is committed to raising the quality of FDI and our own manufacturing, labour and environmental standards moving forward,” he said.

Acknowledging concerns that the CPTPP has provisions that allows multinational companies (MNC) to take the government to court, Ong said MNC’s operating and wanting to invest in Malaysia have very little incentive to take the Malaysian government to international arbitration.

This, he said, was because MNC’s want to continue to work with Putrajaya on matters of common interest – unless the government does something truly egregious like trying to confiscate their property.

The Assistant Political Education Director for the Democratic Action Party (DAP) said there should be an open and honest debate by various stakeholders on the Investor State Dispute Settlement (ISDS) mechanism, which has often been raised as a matter of concern.

He added that the government must also explain how the FTAs will benefit the man on the street.

He also clarified this is his personal view and does not represent the DAP or PH’s position on the matter.

“I want to state clearly that I am in support of ratifying RCEP as well as the CPTPP. This is my personal viewpoint and does not represent the official position of my party, the DAP, nor of Pakatan Harapan,” he said.

“But I am more than willing to explain my position to the leaders in my party as well as in Pakatan Harapan in the hope that they will understand the reasons both big and small as to why I have taken this position,” he added.

Dubbed as Asia’s biggest trade deal, the RCEP is a trade agreement between Asean countries plus Australia, China, Japan, New Zealand and South Korea.

It covers 30% of the world’s gross domestic product.

The CPTPP involves Brunei, Malaysia, Singapore and Vietnam plus Australia, Canada, Japan, Mexico, New Zealand and Peru.

PH opposes the CPTPP as it is worried the FTA will expose Malaysia to foreign interference, among others. – April 12, 2021.