This article first appeared in The Edge Financial Daily on July 4, 2018 - July 10, 2018

KUALA LUMPUR: Ratifying the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) should be a top priority on the new minister of the ministry of international trade and industry’s (Miti) agenda, observers said.

Yesterday, Darell Leiking, the member of parliament for Penampang and Parti Warisan Sabah deputy president, was sworn in as Miti minister.

“Significant work was invested in securing a good deal and it would be a bad idea to try to reopen the agreement now,” the Institute for Democracy and Economic Affairs (Ideas) research director Laurence Todd told The Edge Financial Daily via email, noting the most controversial issues concerning the original TPP were largely removed from the CPTPP. Hence, there are few justifications to renegotiate.

Quoting rating agency Moody’s, Todd said Malaysia is the biggest winner of the CPTPP even without involving the US, with a potential jump in Malaysian exports of 8%.

“The deal also locks in important areas of domestic reforms for the Malaysian economy, including the protection of intellectual property (IP) that will make Malaysia a better place to do business and a more attractive place to invest,” said Todd, adding that the CPTPP is also consistent with the new government’s stance on governance, transparency and predictability.

Beyond the CPTPP, Todd said Miti should focus on building Malaysia’s leadership role within Asean, including in taking forward the negotiations of the Regional Comprehensive Economic Partnership (RCEP). “As a successful trading economy, Malaysia is well placed to advocate greater cooperation among Asean members.”

While talks of trade wars rumble in the global economy, Todd urged Miti to continue maintaining and improving Malaysia’s openness to trade and investments, including by strengthening IP rights, championing competition and enhancing our digital infrastructure to support small and medium enterprises (SMEs) and e-commerce.

Concurring with Todd, Socio-Economic Research Centre executive director Lee Heng Guie also pointed out that Miti should provide clarity on Malaysia’s stand concerning ongoing negotiations for the CPTPP and RCEP.

“Malaysia must actively participate in multilateral trade agreements or mutual trade relations through forging a close link with Asean to push for freer and fairer trade practices amid rising protectionism threats and mindsets in advanced economies. The immediate priority now is to intensify RCEP negotiations,” said Lee.

He also noted Miti should draw up actionable plans to stimulate higher domestic investments and attract more quality foreign direct investments.

Lee said the government and the private sector must assume ownership in two areas — capacity building for trade and market promotion as well as for investment promotion to enhance the foundations for Malaysia to drive trade and investment.

He also urged Miti to be prepared to cope with prolonged trade tensions, calling for a greater need for swift and decisive policy actions to counter the rise of trade protectionism, amid rising threats of a global trade war.