The Trans-Pacific Partnership (TPP) pact will unlock and fuel the next wave of global growth as it addresses issues that go beyond traditional trade.
World Bank country manager for Malaysia Faris Hadad-Zervos said the TPP would deal with issues, including intellectual properties and labour rights that interface among its signatories.
“The TPP reflects a profound review of all things necessary to make world trade flows. We hope the TPP will go through. It is an important trade (pact) that will benefit the participating countries,” he told Bernama in an interview.
The TPP is a trade agreement among 12 Pacific Rim countries, namely Malaysia, the US, Vietnam, Japan, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Peru and Chile.
The finalised proposal was signed in February 2016 in Auckland, concluding seven years of negotiations.
It is currently undergoing a two-year ratification process before materialising in 2018.
However, uncertainty on the outcome of the mega trade deal is mounting with some countries delaying their ratification process amid concerns on the fate of the trade agreement ahead of the US presidential election in November.
Recently, New Zealand Prime Minister John Key said the US would suffer a great deal of lost opportunity should the TPP fell through during the ‘lame duck’ session of Congress.
Key said it would be a loss not only for US consumers and businesses, but also for the potential expansion of the deal to countries such as China, Indonesia and South Korea.
Meanwhile, World Bank senior economist Rafael Munoz Moreno said a new set of trade agreements would open up new opportunities to the participating countries.
He said that government intervention was pivotal in trying to help people to benefit from trade agreements.
“Governments need to make strong engagements with vocal groups and to bring discussions open to evident spaces,” Moreno said.
On the whole, he noted that trade agreements would be beneficial to countries, but some groups might not benefit fully for not being equipped with the right skills.
However, there is a need to propose measures to counter-balance the impact of trade due to criticisms from some parties who claimed that they would lose out in such trade agreements.
“The new set of agreements may enter into more controversial areas as they go beyond traditional tariff reduction and tariff barriers.
“They may also go beyond the environmental standards or labour standards and these become more controversial, thus people feel that they need to position themselves strongly against them,” Moreno said.