Miti seeking best option

PETALING JAYA: The Ministry of International Trade and Industry (Miti) will engage with various stakeholders to get their views and feedback on the withdrawal of the United States from the Trans Pacific Partnership Agreement (TPPA) domestically, before deciding on the way forward, said its Minister Datuk Mustapa Mohamed.
"The TPPA chief negotiators from other 11 countries will be in constant communication with each other to consider all available options before deciding on the best way forward.
"They have been working closely in the last five years and will continue to communicate with each other," said Mustapa in a statement yesterday following the executive order signed by President Donald Trump on Monday, withdrawing the US from the TPPA.
The announcement by Trump effectively ends the aspiration of bringing together 800 million consumers, close to US$28 trillion (RM124 trillion) of wealth (36% of global GDP) and US$11 trillion (RM48.8 trillion) in trade (exports and imports i.e. 26% of global trade).
It has however led the remaining members scrambling to salvage what it can of the pipe dream, which was the TPPA.
Mustapa reiterated that the ministry would focus on enhancing the economic integration of the Asean Economic Community Blueprint 2025; push for the timely conclusion of the China-led Regional Comprehensive Economic Partnership (RCEP); as well as pursue bilateral free trade agreements.
"Notwithstanding the current position of the new US Administration on TPPA, we will continue to engage with our American colleagues to strengthen our bilateral trade and economic relations, given the US' importance as our third largest trading partner and a major source of investment," Mustapa said.
Meanwhile, Asia Pacific chief economist for IHS Global Insight Rajiv Biswas believes that while the 11 TPPA members could create a parallel agreement without the US and move forward, the economic benefits will be significantly reduced without the US, which accounted for around 68% of the combined GDP of the 12 TPPA negotiating partner countries.
This might lead a few TPPA member countries preferring to refocus on the RCEP as an alternative large-scale regional trade liberalization initiative.
"The US withdrawal from TPPA will help to strengthen China's economic leadership position in the Asia Pacific, with its leadership on the RCEP and Free Trade Area of the Asia-Pacific building on its other regional economic initiatives, such as the One Belt One Road regional strategy as well as China's leadership in creating new development finance institutions such as the Asian Infrastructure Investment Bank," he said.