DECEMBER 15 — We recently joined a discussion organised by the Perdana Fellowship Alumni Association (PFAA) involving youth leaders from various parties and organisations regarding the issue of Trans-Pacific Partnership Agreement (TPPA). We applaud PFAA’s arrangement of this roundtable as it provides youths with an inclusive platform where diverse viewpoints were discussed.
While the TPPA does have its merits, during the discussion, we have raised several concerns that this agreement may not directly benefit the ordinary rakyat.
Firstly, it is worth noting that the TPPA may not be able to mitigate any possible increase of prices of goods. With the current economic slowdown, GST implementation together with the weakened ringgit already spelling troubles to consumers nationwide, large corporations may decide to pocket any cost savings received from liberalisation of trade by maintaining the pricing of their goods or worse, colluding with a few big players to increase the prices.
The Rules Of Origin (ROO) of TPPA may also force manufacturers to stop importing cheaper parts from countries like China and India and source from TPPA countries with higher prices. This will further increase the price of goods and burden the rakyat.
Secondly, the readiness of our domestic players may still be way below par. Given the fact that only about 19 per cent or 123,000 Small and Medium Enterprises (SMEs) in the country are involved in exports and the other 81 per cent are involved in domestic market only, they may not be ready to compete internationally in terms of product quality, services, packaging, and standards. Additionally, in terms of productivity, Malaysia is lowly placed with a ratio of 4:1 and 7:1 compared to Singapore and the US respectively. This means that one Singaporean can do the job of four Malaysians, and one American can do the job of seven locals.
Although Budget 2016 aims to increase SMEs GDP contribution rate to 41 per cent, this may not be achieved as they are placed in a vulnerable position when large foreign firms from the TPP-signed countries can freely penetrate the local market. Provided that local SMEs’ average operation costs and other variable costs are expected to be much higher than their foreign counterparts, they will be hard pressed to compete in terms of resources; physical and monetary.
As a result, we may be seeing SMEs slowly phasing out or winding up their business if the government does not provide sufficient assistance to all sectors. This will in turn result in a lot of workers being left out of jobs, bringing a detrimental effect to the overall Malaysian economy.
Thirdly, we are also concerned that the estimated cost for businesses in order to align themselves with TPPA standard is not known, and that no such study is planned to be undertaken. This may increase the price of goods to domestic consumers as local businesses shift the costs to customers.
The current increase of cost of living has badly affected the low and middle-income earners and they are getting more and more concerned with further cost increases. We urge the government to look into these matters and ensure that an effective mechanism is in place so that the few large corporations will not be benefiting at the expense of the others, especially the rakyat.
Clearly, there are still a lot of issues that need to be discussed before Malaysians can truly decide whether the TPPA is good or bad. Such understanding will only be achieved through continuous discourse and open public debate.
Therefore, we were honoured to have been invited to such an esteemed event by PFAA and we hope that this inaugural session among youth leaders will kick-start further engagements in the future.
* This is a joint statement issued by Syed Marwan, Director of Economic Affairs, AMANAH National youth, on behalf of AMANAH youth, DAPSY and KEADILAN youth (Pakatan Harapan youth), in the persons of:
1. Wan Anwar Wan Ibrahim, Vice Chief, AMANAH National Youth
2. Syed Mujahid, Director of Economic Affairs, AMANAH National Youth
3. Mohd Ammar Atan, Deputy Director of Training & Leadership Development, AMANAH National Youth.
4. Bryan Lew, National Secretary, DAP Socialist Youth
5. Raja Iskandar Fareez, Assistant Treasurer, DAP Socialist Youth
6. Adam Fistival Wilfrid, KEADILAN Youth
** This is the personal opinion of the writers and/or the organisations in whose name the joint statement was issued and does not necessarily represent the views of Malay Mail Online.