CPTPP important to our economic survival

Updated 8 years ago · Published on 20 Mar 2018 11:05AM · 2 Comments

THE Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the rebranded TPPA, was finally signed by eleven countries on March 8 without the United States.

The pact had earlier stoked anxiety among certain parties that it would jeopardise Malaysia’s sovereignty and undermine the wellbeing of its citizens.

If we look at the bigger picture, the pact actually benefits the country more in the long run, as our economy largely depends on trade activities.

According to Moody’s research last week, Malaysia would be the biggest winner from the deal – which covers a market of nearly 500 million despite the absence of the US – despite being a small country with a small population.

This fact was further fortified by Peterson Institute for International Economics’ (PIIE) research that indicated CPTPP would benefit palm oil, rubber, and electronics exporters like Malaysia, with export access to new markets including Canada, Peru, and Mexico.

Looking at current data by the Malaysia External Trade Development Corporation (Matrade), Malaysia’s dependency on trade is undeniable, having recorded RM935.39 billion in exports last year and RM838.14 billion in imports, with the nation enjoying a trade surplus of RM97.28 billion.

The electrical and electronics sector remains the top export, accounting for 36.7%, while palm oil products account for 5.8%. On top of that, Malaysia currently is the largest producer of glove products and controls almost 65% of the world market.

In view of this, the deal will definitely encourage existing manufacturers to further expand and attract newcomers to make Malaysia a hub for export markets. It indirectly reduces our reliance on the US market, as it provides new access to untapped markets.

*Ahmad Shahir Abdul Aziz reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.

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Comments

  • My understanding of free trade so far is that it facilitates the movements of goods and labour in such a way that it favours the bosses and disadvantages workers . I don't see the point of supporting TPP or CPTPP or whatever other free trade agreement even if it is good for a trading country like malaysia if it the only thing it does is bring over foreign labour from bangladesh or indonesia or wherever to work in our palm oil and rubber estates or electronic factories. The bangladeshi and indonesians workers just get paid pittance anyway, and the malaysian have to jobless, and the only people who really profit are the estate and factory owners etc. Why support an agreement that facilitates that ?

    Posted 8 years ago by Nehru Sathiamoorthy · Reply

  • I didn’t notice Malaysia implode when Trump canned the TPPA. It was controversial in Phase 1, so what’s changed since then? China and the USA are not included and both are busy in a game of one-upmanship over trade tariffs and embargoes. Seems to me the CPTPP is a bit of a joke which is best left to die a peaceful death. Malaysia would be a good deal better off re-inventing itself and facing up to the realities that this main exports oil and palm oil are no longer the golden goose that was once the case.... and still a resource gifted nation like Malaysia is incapable of feeding itself. That in itself is a criminal tragedy, but one nobody seems to want to address

    Posted 8 years ago by Dennis Madden · Reply