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Demise of TPP hard for Malaysia

Reporter: Rian Maelzer 丨 CCTV.com

11-15-2016 16:35 BJT

News that US President Barack Obama will no longer try to push the 12-country Trans-Pacific Partnership trade agreement through Congress comes as a hard knock to Malaysia.

Malaysia spent years negotiating the deal, and selling a sceptical public on its benefits. But the likely demise of the TPP also comes at a time when Malaysia is already looking firmly east to drive its trade and investment growth. 
Some people on the left feared that the Trans-Pacific Partnership would push up the price of generic medicines and weaken labour protection, while some right wing groups feared the TPP would dilute the special economic privileges enjoyed by ethnic Malays.

But the government and business both saw the deal as key for this heavily trade-dependent economy.

Investors, such as this Chinese textile manufacturer, had been banking on the TPP to give them tax advantages when exporting garments to the US.

But they – and the Malaysian government -- are going to have to re-think their strategies.

“China would become an even more important partner in terms of driving Malaysia to the next level of growth particularly in terms of the greater dependence on intra-regional trade, and then importantly to wean away from the other advanced economies that are currently experiencing a very sharp growth slowdowns.”said Prof. Yeah Kim Leng,economist of Sunway University.

On his visit to China earlier this month, Malaysian Prime Minister Najib Razak signed 35 billion dollars worth of business deals.

“China already is our largest trading partner, and China has the capital to invest in Malaysia so therefore it's only right for us to look at the various economic opportunities that we can arrive at by working closely with China.”PrimMinister of Malaysia Najib Razak said.

Along with six other TPP countries, Malaysia is keen to seal a Regional Comprehensive Economic Partnership with China, the other ASEAN and East Asian countries. The demise of the TPP should only accelerate negotiations.

Malaysia’s trade minister has said that the death of the TPP would make it difficult to meet the country’s growth and job creation targets. But the second finance minister played down the impact, saying that Malaysia has many other bilateral and regional trade agreements to fall back on.

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