KUALA LUMPUR: The Federation of Malaysian Manufacturers (FMM) has expressed its disappointment over the United States’ withdrawal from the Trans-Pacific Partnership Agreement (TPPA).
FMM president Tan Sri Dr Lim Wee Chai said TPPA will contribute significantly to improving market access, expanding exports, increasing economic activities and enhancing employment.
“We are therefore disappointed with the withdrawal of the United States from the TPPA on Monday after five long years of hard work to make the TPPA a reality,” he said in a statement today.
Currently, Malaysia has concluded seven bilateral free trade agreements (FTAs) with Australia, Chile, India, Japan, New Zealand, Pakistan and Turkey as well as five regional FTAs through ASEAN, which includes ASEAN with China, Korea, Japan, India and Australia-New Zealand.
Lim said the TPPA became one of the more important new FTAs being negotiated as it was expected to provide a competitive edge over Malaysia’s regional competitors and build investor confidence in Malaysia.
He said the agreement promised Malaysian companies and TPPA countries a degree of transparency and predictability in investment rules, tariff concessions and avenue to address non-tariff barriers.
“We are therefore heartened to note that there is still communication among the 11 remaining countries to consider all available options to keep the TPPA alive including reformulating the agreement without the US,” Lim added.
TPPA was an FTA among 12 countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and US.
The agreement was expected to open up another 10 per cent of Malaysia’s duty free trade with new non-FTA markets namely US, Canada, Mexico and Peru.
Lim said the government must continue to engage with these countries to strengthen Malaysia’s trade ties through bilateral trade agreements if the TPPA fails to materialise.
“FMM is therefore hopeful of the possibility of salvaging an APEC-wide agreement among the remaining members of the TPPA.
As such, FMM will remain an active partner to the government and will continue to support with views and business inputs on the way forward in the crucial months to come,” he added.
FMM is also looking forward to the successful conclusion of the Regional Comprehensive Partnership Agreement (RCEP) that is currently being negotiated.
Lim noted that the RCEP has made significant progress and FMM is very hopeful for a swift and successful conclusion of the agreement by year-end.
He also hoped that the government would remain committed to the Malaysia-European Union (EU) FTA and resume negotiations at the earliest opportunity.
Malaysia had started negotiations on the trade deal in 2010 but the deal was subsequently put on hold.
Lim said the EU is Malaysia’s largest trading partner and second largest source of foreign direct investment.
“As an open economy dependent on trade and investment to sustain and grow the economy, increased market access for our products at preferential rates is always welcome,” he said.-nst