If you trust American political campaign statements, the wide-reaching Trans-Pacific Partnership free trade agreement is on track to fail final approval after a decade of talks among 12 countries, including four in East Asia.
Both major party presidential candidates, Hillary Clinton and Donald Trump, have voiced concerns about the pact that would encompass about 40% of the world’s GDP.
Some people think their nay-saying is just populist campaign talk to appease Americans worried about losing jobs to Asian imports and that Clinton wouldfinish the pact that her fellow Democratic Party luminary Barack Obama has championed.
The U.S.-led deal cuts import tariffs while raising bars on labor conditions, environmental protection and intellectual property rights.
Back in Asia, Malaysia and Vietnam have started hedging bets in case the U.S. Congress doesn’t ratify the deal by every signatory government’s February 2018 deadline.
The trade pact that received final signatures from government representatives in February this year effectively requires that the United States ratify it to reach 85% of the bloc’s combined GDP, another rule for final implementation.
Malaysia’s parliament is on track to ratify the TPP by amending specific laws, according to local media reports. The Southeast Asian country’s palm oil industry with 2015 exports worth MYR63.2 billion ($15.3 billion) would get a lift from the agreement as other member countries drop import tariffs, analysts expect.
Without the TPP, it would keep fighting to compete with Indonesia’s palm oil exports. But in case Washington backs out, Malaysia is set to see about engaging four countries within the bloc with with which it doesn’t already have two-way trade deals, Trade and Industry Ministry Secretary-General Datuk Jayasiri was quoted saying this month.
“The ball is squarely in the court of the American congress,” says Oh Ei Sun, international studies teacher at Singapore Nanyang University. Malaysia is happy to keep engaging China, as well, he said. China is not a TPP member but a long-time economic benefactor of Malaysia. The United States had sought check the growth of China, a rival superpower, through the TPP.
