I FULLY support what Tan Sri Sulaiman Mahbob, chairman of the Malaysian Institute of Economic Research (MIER), said in his recent article (NST, June 27): that Malaysians should move forward on the Trans-Pacific Partnership Agreement (TPPA) and continue negotiating to get a deal we can be satisfied with. Like Sulaiman, I am with the prime minister on this.
I certainly disagree with those who are hostile to the TPPA and argue that we should just walk away from the negotiations because:
THE treaty was drafted by the United States acting alone;
THERE is a lot of pressure from American businesses and other lobby groups in the treaty template;
TERMS in the draft impinge on our sovereign rights; and,
THE treaty is not just about free trade, but is a grand American strategy to bring the Pacific region countries under its influence to counter the growing threat from China.
If we want to look for hidden agenda, then every international treaty has one. Think of the Marshall Plan, in which the US poured billions of dollars in aid money to revive the economies of war-ravaged Europe after World War 2 some 70 years ago.
The Marshall Plan was about American strategists wanting to check the advance of communism from the Soviet Union in suffering European countries. The Americans figured that the best way to do this was to help Western Europe rebuild itself quickly, so that the people would have hope for their future under a democracy.
In the end, the plan worked. Europe was saved and democracy triumphed over communism.
When China sent two pandas for our zoo, it was also for a strategic reason — to cultivate good relations that would pave the way for its corporations to do more business in Malaysia.
They are especially interested in the billions of ringgit that we are spending on heavy infrastructure, like the proposed high-speed railway link to Singapore. The Chinese want to export their technology to Asian countries and participate in these highly skilled engineering projects to showcase their arrival as a world economic power. They want Asia and Africa to respect their new status as a world power. And, they are prepared to spend money to win friends.
The Americans also have a national agenda, as they believe that when it comes to high technology, and knowledge-intensive products and services, they have the best in the world. Their claim is hard to deny.
Almost every modern technology that we use in our homes, in the office, in the air or under the sea is a US invention. They believe they can export more if they get freer access to the fast-growing markets in the emerging economies, which Third World governments are protecting through unfair trade and non-trade practices. They insist those who want to do trade in the vast American market must reciprocate by opening their markets to foreign competition.
Some Malaysians oppose the TPPA on the grounds that we will be inundated with imports, and we will have foreign investors and businessmen crawling all over the economy. As regards to importing more, this is not necessarily bad and, in most cases, imports are beneficial in giving us access to cheaper goods and services from other countries. Imports bring in equipment and technology to raise the capacity and sophistication of our domestic industries.
Overall, there have been more winners than losers as a result of the competition from imports and foreign businesses and, in fact, many local firms have grown from their trade experience with other countries, producing quality goods to feed the value chain of multinationals, while others have copied or adapted from their foreign partners to strike out on their own.
Increasingly, Malaysian corporations are graduating to become global and exporting directly to the world, constantly exploring new markets for their products and businesses. These companies will benefit from the TPPA and as they prosper through trade and investments overseas, they, in turn, will pull up the smaller companies through the value chain.
In any free trade agreement, it is inevitable that there will be some who will fall out because of competition from the outside. We have to accept this, so that the rest of the country can move forward.
The International Trade and Industry Ministry has indicated that, overall, there is a net gain for the country from the various free trade agreements that have been signed. There is no reason to expect the TPPA to be any different.
As regards to the issue of government procurement being made open to foreign competition and other issues that touch on our sovereignty, these are still under negotiation, according to news reports. Hopefully, our officials will be allowed to continue negotiating to seek a fair compromise, so we can move the TPPA process forward towards a satisfactory conclusion. As Sulaiman said, Malaysia progressed so fast to where it is today because of the openness of our economy to world trade and foreign investment. I would like to add that the trickle-down effects of an open economy have also benefited us in other ways, like increasing urbanisation, rising power of the middle class, richness of our lifestyles, and maturing of our social and political values.
All these are related to our wide exposure to outside influences that are transmitted through trade and investment. Thus, if we want to be a developed nation in the true sense of the word, we need to have catalytic influences from the international community to make us change and adapt quickly to the challenges of a globalised world. I feel that the TPPA can be the right instrument that can bring more, and faster, change in Malaysia.
And, with China flexing its muscle to make all kinds of territorial claims and North Korea acting like a crazy horse on the loose, I would sleep better at night if, through the TPPA, we get more American presence in the region. If we have to make some sacrifices to reach an agreement in the TPPA, let us do so for the sake of the larger objective of securing peace and security.