KUALA LUMPUR, Jan 4 — The withdrawal from the Trans-Pacific Partnership Agreement (TPP) will not bankrupt the Malaysian government, said the Ministry of International Trade and Industry (MITI).
In a statement today, MITI said, the government could be sued for breach of the Investment Chapter of the TPP, and if the breach was proven, compensation might have to be paid.
“However, the withdrawal from TPP does not constitute a breach of TPP,” it said.
According to the ministry, under the Article 30.6, any party might withdraw from the TPP agreement by providing written notice of withdrawal to the depositary.
“Since withdrawal under the TPP is allowed, withdrawal as such is an exercise of our rights and not a breach of the agreement,” MITI said.
The ministry was replying to an article on the TPP published by the former Prime Minister, Tun Dr Mahathir Mohamad, on his personal blog dated Dec 31, 2015 titled ‘Quitting TPP will make Malaysia bankrupt’.
MITI said foreign investors could bring the government to Investor-State Dispute Settlement for a breach of any obligation under the investment chapter of the TPP.
“However, if Malaysia signs the TPP, but then decided to withdraw, the protection under the Investment Chapter would be inapplicable to foreign investors.
“Therefore, the mere act of withdrawal will not result in Malaysia being sued by a foreign company,” it said. — Bernama
