TPPA and the State of Discourse in Malaysia


February 2, 2016

TPPA and the State of Discourse in Malaysia

by Wan Saiful Wan Jan

http://www.thestar.com

You cannot allow others to determine how you dance, or you might win some battles but you will not be able to cope in the overall war.

Well done, MITI’s Dato’ Seri Mustapha Mohamed and his Team-Let us move forward on other Issues like Governance and Corruption–Din Merican

I AM pleased that our Parliament has voted for Malaysia to sign the Trans-Pacific Partnership Agreement (TPPA). Over three days, both the Dewan Rakyat and Dewan Negara debated the issue and the Government won the vote in both chambers.

However I am very disappointed by the way the vote was won. Members of both chambers voted according to their party stance. Both Barisan Nasional and the opposition voted according to the party lines.

If the parties had decided to use the Parliamentary whip, then why hold the special session at all? It was a waste of time and money because ultimately no one used any brainpower in making their decisions. Their parties decided for them.

Together with colleagues from IDEAS, I was in Parliament on the day of the special sitting to persuade the MPs to support our entry into the TPPA. I met some BN MPs who were against the TPPA and I also met some opposition MPs who were supportive of the TPPA. It was a shame that none of them could speak their true mind in Parliament.

I would have preferred for the elected representatives to follow their conscience. Then the special session would have meant something.

Nevertheless, now that the vote is over, let us take stock of what happened.If we look at the past three years leading up to the vote, we must say kudos to the anti-liberalisation activists spearheading the campaign against the TPPA. They were persistent, consistent and determined.

The anti-liberalisation movement operates globally and has never failed to mobilise demonstrations when major trade deals are being decided.There have been anti-liberalisation rallies at the meetings of the World Bank, G8, the World Trade Organisation, and more, in various countries around the world. The movement has now become more organised in Malaysia.

Their strategy is almost always the same globally. Focus on spreading doubts and fear. Repeat the same mantra over and over again. Tell the public that the issue is too complex for anybody to understand it all.

Organise the campaign early and don’t wait for the official text because the actual enemy is liberalisation while the actual text is just a tool. Force the public to compartmentalise the issues rather than analysing the deal holistically.

If one issue is answered, quickly move on to the next one without acknowledging the clarification for the earlier issue.Use selective data and statistics, and discredit others’ studies using any means necessary.

Ask detailed questions like “What is the impact of ISDS (Investor-State Dispute Settlement)?” but spread a generic message such as “America is evil” so that while the other side is busy explaining boring technical facts, they can focus on their more “sexy” rhetorical propaganda.

As a campaign strategy, they were effective. Many MPs I spoke to expressed fear to vote for the TPPA because they felt that they would be voting against “the people”.

The anti-liberalisation activists campaigned loud and long enough to create the impression that they represent public opinion.The reality, in fact, is actually the opposite.

A Pew Research Centre Spring 2015 Global Attitude Survey asked Malaysians “Would the TPPA be a good thing for our country or a bad thing?” In fact, only 18% said that it would be a bad thing.

The main lesson I learned from the whole saga is that you cannot allow others to determine how you dance. If you try to do that, you might win some battles but you will not be able to cope in the overall war.

In the case of the TPPA, yes, Parliament may have passed the motion for us to sign it. But that is just one tiny battle. I am pretty certain that if we check the general temperature in the country now, we will find that the anti-liberalisation sentiment has been strengthened.

In the overall effort to liberalise the economy, pro-reform initiatives are not winning and may have become weaker.As a result, we shouldn’t be surprised if a more organised opposition is mounted when we go into Free Trade Agreement negotiations with the European Union, the European Free Trade Association, other Regional Comprehensive Economic Partnership partners, and more. The TPPA experience has emboldened the anti-liberalisation groups and they will become more effective in the future.

But please don’t get me wrong. I am not at all saying that this is a negative development.On the contrary, I feel it is healthy that the public policy arena is becoming more hotly contested. It is a sign of a maturing society. Now those who want to see less protectionism and more competition to benefit the consumers must become more organised too.

And let me make another important clarification too. Even though I think these anti-liberalisation campaigners are wrong, I believe they are good people who are passionate about their cause. They are campaigning not because they want to damage this country but because they love it.

What we need to do is to continue the debate on public policy in a healthy way. Differences are normal and when it comes to public policy, there will always be consternations.

Most of the thought-leaders at the top celebrate these differences. They can challenge each other in a heated argument, while sipping a friendly teh o ais and munching goreng pisang. Just as those higher up can be civil to one another, so must we.

Wan Saiful Wan Jan is chief executive of the Institute for Democracy and Economic Affairs (www.ideas.org.my). The views expressed here are entirely the writer’s own.

 

Malaysia’s Million Ringgit Man’s Leap of Faith in TPPA


January 28, 2016

Malaysia’s Million Ringgit Man’s Leap of Faith in TPPA–Good For Malaysia and Malaysians

by Tan Sri Shahrir Samad

http://www.themalaysianinsider.com

shahrirtppa

When I first heard of the Trans-Pacific Partnership Agreement (TPPA), I, like most parties, felt very uncomfortable and anxious at the thought of Malaysia entering into negotiations for an agreement that was led and dominated by the United States of America.

It is for the above reason in 2013, I supported the forming of the TPPA Parliamentary Caucus as was suggested by Lembah Pantai MP.Around 2014, I had the opportunity of highlighting my concern regarding the TPPA to Datuk Seri Mustapha Mohamed, the Minister of International Trade and Industry (Miti).

Would the US be able to recognise and agree to all of our list of demands?What about the carve outs and exceptions that we needed? I was inclined to believe that the TPPA would jeopardise our development policies since they did have a history of changing the negotiation goalposts in the past.

Initially, in the conversations that I had with Michael Froman (American Trade Representative), I was under the impression that he did not comprehend the importance of the Bumiputera agenda to us. However, when I learned that Japan had decided to join the TPPA, I perceived this as a positive development as it indicated that the TPPA was not entirely dominated by the US.

In my capacity as chairman of the Barisan Nasional Backbenchers Council (BNBBC), I had attended various TPPA Parliamentary Caucus briefings.

I was periodically appraised of Malaysia’s standing throughout the TPPA negotiations.Instead of blatantly getting emotional and rejecting the TPPA right from the very beginning, I had decided to keep an open mind.

However, that had not meant that I supported the trade pact agreement. Nevertheless, after various engagements and briefings with the negotiators, I slowly started to warm up to the TPPA.

The way that the negotiators had carried themselves while describing, explaining and briefing us had indicated that they were all very capable and accomplished individuals.Through their clarification and justification of their stance on the individual chapters, I had managed to gauge the firmness and decisiveness of our negotiation team on facing disputable issues such as the Bumiputera policy, status of Islam, capital control, halal certification and environment.

What a lot of people do not realise is the reason the Malaysia-US Free Trade Agreement (FTA) in 2007 had collapsed was because importance of the Bumiputera policy was flatly rejected by the US as being protectionist and discriminatory.

Undeniably, the TPPA negotiations were demanding. There were numerous instances where our representatives had left the negotiation table when they had failed to reach a consensus. Meanwhile, back home in Malaysia they were being faulted for trying to sell the country. I cannot imagine what that must have felt like!

After the TPPA negotiation text was released in December 2015, I was pleased to see that all 12 TPPA nations had come to the consensus to accept the Bumiputera policy.The TPPA enables our policy makers to empower the Bumiputera through its policies such as 30% allocation of government procurement.

The outcome of the TPPA negotiations proved to be in favour of Malaysia as we received a lot of exceptions, carve outs and flexibilities. The threshold in construction services given to Malaysian companies was the highest compared to the other TPPA nations.

The 20-year transition period should be more than sufficient for them to embrace the new challenges faced.The hike in medicinal drug prices is not an issue. The TPPA does not change our domestic policies on patents. Halal requirements are carved out from the trade requirements thus allowing us to continue implementing halal requirements related to importation and exportation of food products.

The much feared Investor-State Dispute Settlement (ISDS) tribunal issue was re-evaluated with great concern.The previous ISDS under the other FTAs seemed to be less just and fair to the government. When there is a dispute, the government has the right to interprete matters related to investment through the TPPA Commission.

The burden of proof now lies with the investor and not the state to prove losses suffered. Investors cannot claim losses based on projected future profits.Instead, they can only claim losses based on initial investments made. Ultimately,we must remember that the TPPA does not restrict the government in enforcing administrative actions to regulate policies concerning public health, national security and matters of the environment.

To sum it up, the much maligned agreement is nothing like the actual TPPA text. For that, we have the Miti negotiation team to thank for.

What about the cost of joining the TPPA? Admittedly, new challenges are bound to exist with the formation of the TPPA. For example, SMEs and Malaysian GLCs will have to learn to adjust their business models and operations as they compete with companies from other TPPA countries.However, let’s not forget that we are not changing for the sake of change. We change because these changes come with greater incentives.

TPPA provides an avenue for market access, especially to four new markets (US, Peru, Mexico and Canada).Currently, 18% of our SMEs are already exporting their products and services to other countries. With the TPPA, the possibilities are endless!

The TPPA will give us a competitive edge as it requires us to discipline ourselves in trade and investment matters. This ensures conducive investment avenue, healthy competition and overall improving society through multi-products and the increased availability of high-paying jobs.

Remember, the TPPA is still going to be implemented with or without Malaysia. Vietnam will overtake us if we are not part of the TPPA.We would have to say good bye to high-value investments because countries such as Vietnam and Singapore will look more and more attractive to said investors.

What is worse is that in order to be more competitive, our home-grown companies might even decide to relocate and invest in TPPA countries.Should we decide to join the TPPA in the future, it would not be on our own terms as we were not part of the negotiations and therefore would have to accept the TPPA that had originally been agreed by the founding members. The changes we would then have to make to our laws would be more difficult and painful.

For some strange reason, there are those that are sceptical with the ability of Malaysia to compete with developed nations.They believe that Malaysian companies are not equipped with the expertise required and that Malaysians are inferior to the westerners. This view greatly saddens me.

Do they need to be reminded that a Malaysian consortium currently runs the best property development project in London?Malaysians are also the ones that had planned the Dawn Raid in 1981 which shocked the London capital market when we acquired Guthrie.

Currently, three Malaysian scientists have been named as the world’s most influential minds. To me, these examples (and there are many more) justify Malaysia’s standing as a globally acclaimed success.If it was possible for “Malaysia Boleh” back then, why would it be any different now?

Today, our young generation has become more inter connected. By utilising technology and its advancements on social media, they are now venturing into sharing economy model which has revolutionised the way business is conducted.

More and more of these startup companies have been created and now some have become very lucrative. Recently, two young Malaysians successfully reinvented the way we hire lorries via TheLorry.com. They have been so successful; a Singaporean company has decided to invest US$1.5 million to expand their business in Southeast Asia.

On another front, FashionValet.com has managed to secure a multi-million dollar investment deal from a San Francisco-based venture capitalist. Currently they operate in four different ASEAN countries (Brunei, Singapore, Indonesia and Malaysia).

These examples clearly illustrate young Malaysians are capable of keeping up with the times and embracing change. Not only are these young Malaysians able to compete in today’s global arena, they are triumphant in doing so.

Competition is not an alien concept to Malaysia. Ever since our independence, we have strived to be competitive. Nothing has changed as we will only continue to do so now and in the future.

Over January 25 and 26, the Malaysian Parliament will discuss, debate and vote on the merits of the TPPA. Some will say that the ruling party will bulldoze the TPPA through Parliament because we have the numbers.

I want to emphasise that the BNBBC will not blindly support the TPPA simply because we have to toe the party line but rather, we support it because we truly believe that the TPPA will benefit the country and its people.

I believe that Malaysia should be unafraid to take our place in the world. Change is a constant and it is a fact of life. The TPPA is my leap of faith in Malaysia and in Malaysians.

* Tan Sri Shahrir Samad is chairman of Barisan Nasional Backbenchers Club and Johor Baru MP.

 

TPPA: Trade and Geo-Politics


January 25, 2016

TPPA: Trade and Geo-Politics

by Dr. BA Hamzah

http://www.thestar.com.my

 

THOSE familiar with the literature on international trade will appreciate the symbiotic relationship between trade and geo-politics. Take the case of US-led economic sanctions against Iran and Cuba. They were not imposed for solely economic reasons. On the contrary, it is normal for major powers to use economic sanctions as a tool in making foreign policy. The tool can manifest in the form of trade barriers and restrictions on financial transactions to punish a state for “misbehaving”.

The Trans-Pacific Partnership Agreement (TPPA) is no exception. World renowned Professor Noam Chomsky (pic above) of Massachusetts Institute of Technology (2015) believes the TPPA is designed to carry forward the neo-liberal project to maximise profit and ensure America’s domination of the world. So does Nobel Prize-winning economist Joseph Stiglitz who views the TPPA as a managed-trade agreement of “unequal partnerships with the US dictating the terms”.

In Stiglitz’s view, partnership agreements like the TPPA “go beyond trade, governing investment, intellectual property as well, imposing fundamental changes to countries’ legal, judicial and regulatory frameworks without input or accountability through democratic institutions.”

IMF Photograph

Professor Joseph Stiglitz

Under the TPP, the status of the MNCs has been elevated to that of a nation state. MNCs have used and intend to use the controversial investor-state dispute settlement (ISDS) mechanism as an instrument in public international law to sue sovereign states for non-compliance with the agreement. In the opinion of many, the ISDS has elevated trade to a new geo-political height.

Should Malaysia not be concerned with the above observations as it hurries to ratify the TPPA before President Obama leave office in 2017? Obama minces no words on the geo-politics surrounding the TPPA as much as it is about international trade. He proclaimed to the world on October 5, 2015 that “this partnership (TPPA) levels the playing field for our farmers, ranchers, and manufacturers by eliminating more than 18,000 taxes that various countries put on our products.

The US President adds, “[I]t includes the strongest commitments on labour and the environment of any trade agreement in history, and those commitments are enforceable, unlike in past agreements.It promotes a free and open Internet. It strengthens our strategic relationships with our partners and allies in a region that will be vital to the 21st century. It’s an agreement that puts American workers first and will help middle-class families get ahead.”

America needs the TPPA to compliment Obama’s foreign policy of pivoting or rebalancing its military deployment (2011) to prevent its rival (read China) from dominating the Asia-Pacific region.

In a statement on the TPPA, President Obama asserted that “we can’t let countries like China write the rules of the global economy. We should write those rules, opening new markets to American products while setting high standards for protecting workers and preserving our environment.”

In endorsing the TPPA, Secretary of State John Kerry told students at Indian State University (October 14, 2015) that the TPPA “matters for reasons beyond trade”. His remark that the Asia-Pacific region “will have a big say in shaping international rules of the road on the Internet, financial regulation, maritime security, the environment and many other areas of direct concern to the United States” clearly defines the US geopolitical agenda in the TPPA.

Secretary of State  John Kerry

I really don’t understand why some continue to deny the geo-political genesis and content of the TPPA. It is okay for Malaysia to adopt a pro-US policy to balance the rise of China but we should not plunge head on without reconsidering the consequences of becoming a party to the US strategic foreign policy of using the TPPA to contain China, our largest trading partner in South-East Asia. It may be perilous to our long-term geo-political interests to undermine China.

Like the US proposal for the Transatlantic Partnership in Investment and Trade for Europe, the TPPA is a tool of US foreign policy to retain its pre-eminence by writing the rules of the global trade and international security.

There is nothing sinister about the TPPA if Malaysia is prepared to embrace a trade deal that helps promote US foreign policy.Acknowledging the geo-political ramifications of the TPPA on Malaysia will result in greater policy transparency and reduce the trust deficit between the rakyat and the Government.

TPPA–Time to Listen, not just be selective with Facts


January 20, 2016

TPPA–Time to Listen, not just be selective with Facts

by Wan Saiful Wan Jan

http://www.themalaymailonline.com

IWan Saiful Wan Jann a recent statement DAP Member of Parliament Charles Santiago, repeated his assertion that the Trans-Pacific Partnership (TPP) would affect access to affordable medicine.  He cited the case of Jordan and claimed that the prices of medicine there increased by 20 per cent and the generic drug industry was wiped out six months after they signed a free trade agreement with the United States in 2001.

“I fully support YB Charles Santiago’s demand for the Ministry of Health to be more engaged and work together with the Ministry of International Trade and Industry in communicating the impact of the TPP on healthcare in Malaysia,” said Wan Saiful Wan Jan, Chief Executive of IDEAS.

Mustapa-Mohamed-TPPA-300x202

“But is regrettable that the DAP MP was selective with facts to support his arguments and he turns a deaf ear when answers are given to address his concerns.” What has been deliberately omitted from the story about Jordan by opponents of the TPP are the two major benefits the country enjoyed as a result of its free trade agreement (FTA) with the US.

Wan Saiful added: “Firstly, Jordan saw increased investment in research and development and the introduction of new, innovative and effective drugs into the market. Liberalisation of the regulatory environment led to 78 new launches of innovative medicines within ten years, more than double Jordan’s pre-reform rate. The reforms catalysed by the FTA spurred local healthcare entrepreneurial activities leading to more products being developed by Jordanian companies such as the Jordan Pharmaceutical Manufacturing Company. The FTA helped Jordanian consumers access to new and innovative medicines, and this is good.”

Charles Santiago

“Secondly, Jordan enjoyed the introduction of best practices and international standards in the country’s industry. Prior to the reforms, only one Jordanian company was certified for Good Manufacturing Practises (GMP) and this raised questions about the quality of locally produced generics before reforms. After reforms, at least four more Jordanian companies achieved international GMP certification, enabling for more Jordanian produced generics to be used locally and exported for the regional and international pharmaceutical markets. Today, post-reform, Jordan has become the leading Arab exporter of drugs, exporting   cent of their production to some 66 countries.”

“It is telling that in November last year, Thailand, a country that depends on generic medicines extensively in its universal healthcare coverage scheme, has expressed its intent to join the TPP. Is YB Charles saying that the Thais don’t understand what they are getting themselves into?  The fact is, the reduction of trade barriers will allow the price of generic medicines to go down and this is good for health. Since Malaysia wants to use mostly generics in our healthcare system, we should focus on the wider positive benefits of TPP on the pricing of generics.” said Wan Saiful.

Wan Saiful concluded that “YB Charles has been a consistent anti-liberalisation campaigner and I respect him for his persistence. I am sure he and other anti-liberalisation campaigners will continue nit-picking to oppose the TPP.  But being selective with facts and refusing to listen when answers are given is not the way to handle this issue.”

* IDEAS is an independent not-for-profit think tank dedicated to promoting market-based solutions to public policy challenges.

The Politics of TPPA–Trade or Geo-Politics ?


January 15, 2016

jokowi-with-ahok-at-data

10895117_1566330740245360_486142947_a

Condolences to Indonesia–Stay Strong

The Politics of TPPA–Trade  or Geo-Politics ?

by Rama Ramanathan

http://www.themalaysianinsider.com

Najib and Obama

 

Mr. Najib, what is the real deal?

In my last article, I said I oppose Malaysia signing the Trans Pacific Partnership Agreement (TPPA), principally because our government runs on cronyism, our Parliament is a rubber stamp for the regime’s wishes, and 11 nations are profiting by rubber-stamping an undemocratic regime in Malaysia.

I also said that despite their exaggerations, many who claim Malaysia will lose in several areas are not wrong. I said we must view TPPA as a trade: we must ask what we will gain, not just what we will lose.

NGOs and opposition parties have called attention to many losses. Despite their exaggerations and emotive language, there is truth in what they say.

The government and proponents of TPPA have been relatively silent about the gains. Malay rights groups wanted to be assured that the privileges accorded to them in government policies will be maintained.

The Prime Minister has convinced them that the 11 nations have agreed not to challenge race-based policies in Malaysia.

What does TPPA contain?Don’t believe those who say TPPA is a public document which anyone can read and assess.It’s true it’s public. It’s true that all of it is available. But, it’s also true that it’s only available in fragments – everything listed in the contents page is a separate document.

Not only is it fragmented, it is also subject matter-intensive. You need to have some understanding of economic and political models in order to read it with understanding.

You need to ask questions such as: How is this different from other trade agreements? Why would countries ranging from Peru to the US agree to this?

What existing mechanisms are being bypassed? What will be the impact on foreign and domestic investments? It is common knowledge that big nations are flexing their muscles. Russia has gone it alone with bombing raids in the Middle East. China has started building an airbase on a disputed island. The US is running military operations in the Middle East. Mostly, the US is worried about China becoming a hegemon in the Pacific.

TPPA-Malaysia-oki-menos-3

Malaysia is sending confusing signals about its relations with the Chinese. On the one hand, UMNO leaders rail against the Chinese community in both Malaysia and Singapore; on the other hand, the UMNO-controlled government, through 1MDB, has sold power generation assets and land to companies incorporated in China.

Malaysia has often said that the US foreign policy is controlled by Jews – a religious-racial group which Malaysia’s official Islam loves to hate. Also, Isis/ISL, the self-styled Islamic State, considers all friends of the US enemies of Islam.

So why would Malaysia now want to openly ink a formal alliance with the US? Is TPPA an alliance with the US? Is the US the de facto head of TPPA? Do nations which sign the TPPA – such as Australia, Canada, Japan, New Zealand and Singapore – agree to recognise the US as hegemon?

By “hegemon”, I mean “the dominant partner”, the driving force for completion of the agreement and for enforcing it. Economists who subscribe to “hegemonic stability theory” say a massive military and economic power is needed in order to ensure free trade occurs routinely and peacefully.

The big idea is that the nationalistic ideas of small states – often expressed through protectionist tariffs – must be ended if free trade is to prevail.The big idea is also that only a big economy can afford the short-term costs of allowing smaller economies to “gain”, in order to ensure overall stability and protect the big economy in the long-term.

According to the theory, the hegemon must (1) have enough power to enforce the rules of the system; (2) have the will to exercise the power and (3) be committed to the betterment of all rather than a narrow nationalistic interest.Do you believe a hegemon is necessary? Do you believe the US meets all the criteria?

Since, in ASEAN, only Malaysia, Singapore and Vietnam are TPPA signatories (to-be), does it even matter?

I don’t know if there is one correct answer. I just know that most whom I’ve heard discussing TPPA haven’t discussed this aspect of it.I’ve not come across any articles which validate the “US as hegemon” argument by citing passages or themes from TPPA.

For me, TPPA is yet another display of the ignorance of our Cabinet, the narrow-mindedness of the opposition and many NGOs, and the ignorance of the public including myself, about trade and governance.

Why is our government so ineffective in communicating the benefits of TPPA? Why are the opponents of TPPA so effective in sowing doubts? Who should we trust?

 

Join Rally to Stop TPPA–End Wall Street Rule


January 13, 2016

Join Rally to Stop TPPA–End Wall Street Rule

by Sivarajan A.
PSM Secretary General
Mobile: 010 2580 455

PSM

Parti Sosialis Malaysia (PSM) will take to the streets on January 23, 2016 at Dataran Merdeka, Kuala Lumpur, 2 p.m to oppose the Trans Pacific Partnership Agreement. We urge the rakyat to join us in this final and most important rally to stop the TPPA.

Parti Sosialis Malaysia has been fighting against the US led Trans Pacific Partnership Agreement since Malaysia’s participation in 2010. Even since 2005, we have voiced our concerns to the then trade Minister Tan Sri Rafidah Aziz when US lured Malaysia into negotiating the US Malaysia Free Trade Bilateral Agreement.

OBAMA TPPA

The aspirations of the US Multinationals and investors are still prevalent in the TPPA, as they rush to secure their economic interest by side lining growing China’s influence in the region. It is clear how the TPPA will trample upon our rights for affordable medicines, job security, food security, affordable education etc,.

PSM is puzzled by the Najib led government persistence to ink the deal despite various studies and findings by scholars, economist debunking the so-called benefits of the TPPA. Recently Professor Dr Jomo Kwame Sundaram revealed that TPPA will only lead to unemployment, inequality instead of real economic gains for Malaysia.

Jomo KS

For the past two months PSM has been on a road show throughout the country educating the rakyat on the implications of the TPPA.  From the road show we gather that the people are not convinced of the benefits of the TPPA, being already burdened by the rising cost of living and GST and rampant corruption and abuses of power.

Thus we urge the rakyat to come out in force on  January  23, to express our opposition to the TPPA. This will be the deciding rally to make our voices heard to Najib Tun Razak that he is now making another big mistake in his leadership .

PSM will fully mobilise our forces to make this peaceful protest rally a success. The gathering will take place at Dataran Merdeka and PSM will lead a march from Maju Junction on that day at 1 pm. We welcome all grassroot organisations, unions and NGO’s to join us.  Stop TPPA ! End Corporate Rule !