Malaysian Cabinet Gives Green Light to Join TPP (Trans-Pacific Partnership) Agreement Talks

Malaysia, Seeking To Join TPP, Moves Ahead With Bilateral Consultations

Aug 13, 2010. According to a news report, the Malaysian Cabinet had given the go-ahead to join the Trans-Pacific Partnership (TPP) and it is now up to the member countries of the regional grouping to decide on Malaysia’s entry.

The TPP currently comprises eight countries, namely, the US, Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam. So far, they have held two meetings and they hope that a framework will be developed by end-2011 when the Asia-Pacific Economic Cooperation meets in the U.S.

Key areas that Malaysia are prepared to negotiate reportedly include services and government procurement, the latter being one of the most contentious issues that is believed to have caused the impasse in the currently stalled Malaysia-US FTA negotiations. According to reports, the Malaysian government is performing a cost-benefit analysis of an eventual TPP agreement, focused on these sensitive areas and considering how the TPP agreement would fit into Malaysia’s broader economic strategy.

The Malaysian government has committed internally to seek to join Trans-Pacific Partnership (TPP) agreement talks, has communicated its interest to TPP members, and is now in the process of conducting bilateral consultations with those current TPP members to address any concerns they might have.

In addition to the bilateral consultations, TPP members have agreed that Malaysian officials will also have to meet with officials from current TPP negotiating partners as a group in order to discuss the possibility of joining the talks. This will afford Malaysia and current members the chance to further exchange information, Deputy USTR Demetrios Marantis explained.

Marantis said there is “no established time frame” for such a meeting to take place. “We are still … working through our process with Malaysia, but we haven’t had the same level of in-depth discussion with Canada that we’ve had with our other TPP countries before we did the launch” of the talks, he said.

When asked if bilateral consultations with Malaysia were presenting any difficulties, Marantis said the U.S. is still going through that process. “That is what we are sorting through right now,” he said. One source said there appeared to be few problems arising thus far in the bilateral talks between Malaysia and current TPP partners.

One source said Malaysia hoped to join the talks as soon as possible in order to be able to influence the framework under which the talks will be conducted, which is still being decided. Sources also said USTR appeared supportive of Malaysia joining the talks, and had worked for months to bring about that result.

One source said the bilateral consultations are focused on the issues of government procurement, services and financial services, all of which were sticking points in the U.S.-Malaysia free trade agreement negotiations, which essentially halted inconclusively in 2007.

Malaysia resisted efforts by the U.S. to negotiate the FTA services chapter on the basis of a “negative list” approach, under which a country opens its markets in all sectors except for those specifically excluded. Malaysia preferred a “positive list” approach, under which only the specified sectors are subject to liberalization.

However, the Malaysian government is now ready to endorse a negative list approach, this source said.

Read more …

Malaysian Cabinet Gives Green Light to Join TPP, Business Times, Jul 31, 2010

Malaysia, Seeking To Join TPP, Moves Ahead With Bilateral Consultations, Inside U.S. Trade, Aug 13, 2010 (subscription required).