Global Trends by Martin Khor

Star, Monday 2 September 2013

An eventful week on the TPPA   

Blurb:  The last week saw a series of important events on the hot topic of Trans-Pacific Partnership Agreement, with the official round in Brunei, and a roundtable in Kuala Lumpur, leading to the question:  What next?


Last week saw many important developments on the Trans-Pacific Partnership Agreement (TPPA).

The 19th Round of the negotiations concluded in Brunei after an intense week. It emerged that many issues are still controversial and that the target of signing the treaty by year end cannot be met.

Malaysia’s tone at the negotiations has also changed, with International Trade and Industry Minister Dato Sri Mustapa Mohamed informing his fellow Ministers of the domestic opposition to the TPPA and various issues which Malaysia has problems with.

Malaysia’s negotiators earned bouquets from NGOs for tabling a new proposal that tobacco control measures should be excluded altogether from TPPA disciplines.

Meanwhile in Kuala Lumpur a roundtable workshop on the TPPA brought together 200 people. Keynote speaker Tun Dr. Mahathir Mohamed reaffirmed his opposition to the TPPA and urged the government not to join it.  

The 26-27 August roundtable was organised by the MTEM (Malay Economic Action Council) and the Perdana Leadership Foundation.

The participants came up with 75 “red lines”, or positions that are non-negotiable, that they would like the government to adopt.      

Prime Minister Datuk Seri Najib Tun Razak received the “red lines” document from the MTEM leadership at the group’s Hari Raya open house on 28 August. 

Mustapa also announced the government was going ahead with organising two cost benefit studies on the TPPA’s impacts on national interests and on SMEs and the Bumiputra economy. Only if there are net benefits will the country sign the treaty.

It looks like the strong views voiced by various groups and politicians have influenced the government’s thinking.

A strong sign of this was at the Ministerial meeting of TPPA countries in Brunei on 22-23 August.   Chaired by the American Trade Representative, the meeting was supposed to give Ministers the chance to clear the contentious issues that the technical negotiators could not settle, and thus pave the way to a quick conclusion.

Instead, the Ministerial turned into an anti-climax as some Ministers did not attend, and some others who attended did not stay for the press conference that lasted only 20 minutes.

And instead of clearing hard issues, the Ministerial gave a chance to some Ministers to highlight some contentious issues themselves.      

Mustapa was one of those who took that opportunity.  “I drew attention to the growing discomfort domestically arising from Malaysia’s participation in the TPP negotiations, the outreach activities that had been undertaken and the concerns raised by the various stakeholders, specifically on the issue of lack of transparency and disclosure of information on the texts being negotiated,” said the Minister in a statement.

He also highlighted the difficulties Malaysia has on government procurement, the need for exclusions of SMEs and preferences for bumiputera which are required for the Malaysian government to continue with its socio-economic development goals and affirmative action policy.

He also underscored that Malaysia had serious difficulties with the current proposal on state-owned enterprises, which is seen to go beyond the stated objective of creating a level playing field as it had serious implications for Malaysian SOEs.

And on intellectual property, he reiterated Malaysia’s strong position on access to affordable medicines while on environment, that there is need to safeguard the state governments’ jurisdictions.

The following day, Malaysia also caused quite a stir by putting forward a new proposal to totally exclude tobacco control measures from the disciplines of the whole TPPA.

This was warmly welcomed by public health groups, which then called on the US and other countries to agree to the Malaysian position.

At the MTEM roundtable in Kuala Lumpur, Tun Mahathir gave a 40-minute critique of the TPPA, the problems it would create for domestic policy, why Malaysia can expand its trade even without such agreements.  He ended with a strong call to the government not to sign the treaty.

For two days, the participants discussed specific TPPA issues in six breakout groups and at the closing plenary they adopted 75 “red lines” which they called on the government to take on as part of its negotiating positions.

The “red lines” include a rejection of the investor-state dispute settlement system, the exclusion of the chapters or sections on government procurement and state-owned enterprises, and demands that the intellectual property chapter does not require obligations that are stronger than the WTO’s rules, especially with regard to patents and medicines, and copyright issues. 

It should be noted that some of these civil society red lines correspond to the concerns that Mustapa had taken up at the TPPA Ministerial. 

It looks as though the government’s position has been affected by the voices of civil society, business and experts.

A key question of course is whether in taking up these issues, the Minister and the negotiators will make their own “red lines” out of the concerns.

The next question is whether the other TPPA participants will accommodate themselves to Malaysia’s positions.  And if not, then what happens next.

In any case, it has been a very interesting week or ten days, full of events and developments, on the hot issue of TPPA, both at the official meeting and on the home front.