Dear All
I have just returned from one of my trips to many developing and least developed economies. My first and second trips to the Federated States of Micronesia thought be a very humbling lesson in life, that a small island country in the middle of the Pacific look forward to overcome their size and distance to be economically competitive. The main disadvantage of Micronesia is the distance and connectivity from the rest of the world, but this does not mean that they are locked out from all what happens in the developed world. They want to be developed and want to be an advanced country. In this trip I managed to visit Nan Madol, the old kingdom of Micronesia that started in the year 500 AD, which shows Micronesia has been having civilisation much earlier than many of the states in the Malay world. This also shows that international trade has been an important part of human civilisation from time immemorial. Another lesson I learnt from my work in the developing world is the "fear of the unknown" which can be overcome by having rational discussions over issues in the mind of the people. We can overcome "the fear of the unknown" if we use our mind instead of our emotion.
This brings us to the biggest of the century: TPPA.
TPPA is a trade agreement between 12 countries in the Pacific region. It opens to all APEC members to accede to it at a later stage if they want to. In fact many countries have indicated their interest to joint as acceding parties.
But Malaysia has the upper hand as we are the original party and we have the advantage of being able to dictate terms to the acceding countries, over and above of what have been agreed upon by the original parties.
In this edition, I will focus on the big picture.
Let us do away with our emotion when discussing this important topic. There are several reasons why TPPA is important for us:
1. We are a trading nation. Our trade is more 100% of our GDP. One may say we will continue trading even without TPPA, yes agreem but at different price and different terms. With tariff has become so low, non-tariff barriers will increase the cost and TPPA's advantage is about reducing the non-tariff barriers among the signatory countries.
2. Linkages between trade and investment. With trade we will be able to increase investment. It does not mean that the economy will die if we do not join TPPA but investors will be looking for better market to invest in, markets that offer more liberalised market access.
3. No colonisation by major corporates. We are talking about trade and investment. Major companies have been investing in Malaysia already even before the TPPA, has there been colonisation? Are we saying that we should not welcome British firms or Portuguese Firms or Japanese firms? We have to strategise our economic approach on how to leverage from the investment by major firms. They bring in capital and innovation that we need to enhance our economy and to enhance our linkages to the global value chain. The Global and regional value chain is important for Malaysia as we cannot ignore the fact we have been a global player and part of the global value chain since the beginning of the history.
I will stop here for a while and will come back with more later today or tomorrow.
In the meantime, even if one objects to the TPPA, please let us have healthy debate by using our rational mind and overcome our emotion.
Have a nice day
