Signing of CPTPP signals Malaysia's commitment towards open, liberal trade

PETALING JAYA: The signing of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) sends a strong signal of Malaysia’s commitment towards an open and liberal trading system.
Minister of International Trade and Industry Datuk Seri Mustapa Mohamed said the signing of the agreement is timely, in light of recent protectionist sentiment which is prevalent in a number of countries.
“What the world needs now is more trade and investment flows and not restricted markets,” he said in a statement on Friday.
Malaysia and 10 other Asia Pacific countries namely Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore and Vietnam signed the CPTPP in Santiago, Chile, on March 9 after eight rounds of negotiations. The CPTPP was concluded on Jan 23 in Tokyo.
“With the conclusion of the CPTPP, the Ministry of International Trade and Industry and our colleagues from other ministries and agencies will now focus our attention on concluding the Regional Comprehensive Economic Partnership (RCEP) negotiation. It is our view that both CPTPP and RCEP will serve as building blocks towards a more open and fairer trade and investment regime in the Asia Pacific region,” Mustapa said.
Meanwhile according to Moody’s report titled “Sovereigns – Asia Pacific and Americas: Revised Trans-Pacific Partnership benefits all members, but less so without the US”, lost trade opportunities will be felt most in Vietnam, Malaysia and Japan, because these countries stood to gain the most from greater access to the US market, given the scope of current trade agreements.
“Nevertheless, Malaysia will prove the biggest winner from the revised agreement, because the deal will provide export access into new markets, including Canada, Peru and Mexico; benefiting palm oil, rubber and electronics exporters,” it said.
Meanwhile, with the CPTPP, real incomes will rise in Singapore, Brunei, Vietnam and Peru.
“The ongoing reform efforts should boost competitiveness and investment, and strengthen institutional quality over time for member nations. And, the benefits would be greatest for sovereigns with relatively low governance and competitiveness scores, such as Peru, Vietnam, Mexico and Brunei,” it added.
Based on estimates from the Peterson Institute for International Economics, the real income gains for members would be much greater than the current CPTPP deal, and higher than the original TPP pact, if membership expands to include other large Asian economies like Indonesia, Korea, the Philippines, Taiwan and Thailand, which have expressed interest in joining.