US' absence creates greater opportunity for TPP11

KUALA LUMPUR: The US withdrawal from the Trans-Pacific Partnership (TPP) creates greater opportunity for the remaining 11 signatories (TPP11) to reform their domestic and regional trade regulations, said Dr Deborah K. Elms, the Executive Director of the Singapore-based Asian Trade Centre.

She said this was contrary to popular belief that the backing out of the US would bring catastrophic effect to the economy and security of the remaining 11 countries in the trade deal or the Asia Pacific region in general.

"The US does little in TPP. Other than textile, footwear and some food products, the US market is relatively open already. So, countries outside the US can access to their services, investment, intellectual property (IP) rights, and custom rules.

"But TPP did a lot for the 11 countries as they will benefit each other through access to services, change Customs rules, and protection of their IPs to name a few. TPP11 will help lowering trade barriers between countries which can be realised by reforming the regional trade regulations," she told Bernama following the fourth plenary session of the 31st Asia-Pacific Roundtable here, today.

Elms said while those benefits would remain for the 11 countries, US-based companies would face difficulties to access these markets and hence, lower the competitive pressure from them on TPP11-based companies.

Citing trade barriers issue in Vietnam's pharmaceutical market which hindered branded products from entering as an example, she said the TPP would allow consumers in the country to have access to branded medicines whether the US is in or out of the deal.

Elms pointed out that participating countries in the TPP had focused too narrowly into pharmaceutical products when the bigger benefits of the trade deal was that it opened up many other aspects attached to healthcare such as healthcare-related products and services.

On the challenges confronting the TPP11, she said the regulatory framework to support the trade deal would be a mounting task as it would not be easy for some countries to abide by the rules.

"For example, things like how do we help with TPP rules on Customs. TPP says you need to move perishable goods through Customs in six hours and you need to move all other goods through customs in 48 hours.

"That's not easy and a very challenging process, especially because it is meant to be the same at every port of entry. That can be tough especially for big countries with a lot of ports and it is hard to make every port of entry to follow the same procedure," she said.

The 11 remaining signatories, namely Australia, Brunei, Chile, Canada, New Zealand, Japan, Malaysia, Singapore, Mexico, Peru, and Vietnam had agreed to promote the so-called TPP11 trade liberalisation deal.

The decision was made the 23rd Asia Pacific Economic Cooperation (APEC) Trade Ministers' Meeting in Hanoi recently, during which they agreed to complete the preparatory work by November in order to put the deal quickly into force. — Bernama