Spotlight: The TPP’s ASEAN impact

Reading Time: 2 minutes

Elk_TPPExclusionary trade treaties are the weapon de jour of geopolitics. In the race to form the most comprehensive, tightly knit world order, the US and China have been hand over fist to entreat ASEAN countries to agree upon membership with their respective trade pacts.

The US’s Trans-Pacific Partnership (TPP), a band of 12 nations in Asia and around the Pacific Rim, was the subject of online discussion on July 19 by Inside Investor and guest commentators.

Of the 10 ASEAN nations, Singapore and Brunei are the only that have confirmed TPP membership, while others remain on the fence, such as Vietnam, Malaysia and Thailand, the latter of which is deliberating whether the benefits of the trade agreement will be worth the damage to its pharmaceuticals industry.

“It’s obvious that TPP aims to check China’s influence. To choose between the US vs China is unclear for Thai foreign policy,” said Mr Kan Yuenyong, founder and Director of the Siam Intelligence Unit in Thailand.

“Thailand already has FTAs with most members in The TPP. Major trade partners are ASEAN members, China and Japan,” he said, adding that “Thailand is on both China’s and Japan’s value chain to export to the US.”

That compulsory licensing would be enforced under the TPP regime, an industry that is rife with counterfeits, has struck up a strong lobbying force against Thailand’s entrance. However, the US has gained traction in Myanmar, an increasingly importance destination for Thai investors, and could begin to sway the Mekong region more into its orbit and away from China and its ineffective belligerent territorial policies.

Malaysia could be well positioned in the new order to dictate policy.

“Seven out of twelve of the TPP members have FTAs with Malaysia,” said Fiedo Rosli of the Institute of Strategic and International Studies Malaysia.

“Early membership gives us great bargaining power,” he added.

Although there is still objection by Malaysia NGOs and Bumiputera-linked groups, Rosli feels the TPP could be a win-win.

“Sign or not, Malaysia gains in many areas, including cap building of trade negotiators,” Rosli said.

He added: “Subsidy rationalisation is already in the government’s agenda, but [it has been] snail-paced. The TPP could inject sense of urgency.”

Ultimately, the fate of the US-lead trade treaty is still unknown in ASEAN, but Mr Rosli poses an insightful question.

“Win or lose is a highly debatable [matter] at this point, but do we know the cost of NOT being a member of the TPP?”

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Reading Time: 2 minutes

Exclusionary trade treaties are the weapon de jour of geopolitics. In the race to form the most comprehensive, tightly knit world order, the US and China have been hand over fist to entreat ASEAN countries to agree upon membership with their respective trade pacts.

Reading Time: 2 minutes

Elk_TPPExclusionary trade treaties are the weapon de jour of geopolitics. In the race to form the most comprehensive, tightly knit world order, the US and China have been hand over fist to entreat ASEAN countries to agree upon membership with their respective trade pacts.

The US’s Trans-Pacific Partnership (TPP), a band of 12 nations in Asia and around the Pacific Rim, was the subject of online discussion on July 19 by Inside Investor and guest commentators.

Of the 10 ASEAN nations, Singapore and Brunei are the only that have confirmed TPP membership, while others remain on the fence, such as Vietnam, Malaysia and Thailand, the latter of which is deliberating whether the benefits of the trade agreement will be worth the damage to its pharmaceuticals industry.

“It’s obvious that TPP aims to check China’s influence. To choose between the US vs China is unclear for Thai foreign policy,” said Mr Kan Yuenyong, founder and Director of the Siam Intelligence Unit in Thailand.

“Thailand already has FTAs with most members in The TPP. Major trade partners are ASEAN members, China and Japan,” he said, adding that “Thailand is on both China’s and Japan’s value chain to export to the US.”

That compulsory licensing would be enforced under the TPP regime, an industry that is rife with counterfeits, has struck up a strong lobbying force against Thailand’s entrance. However, the US has gained traction in Myanmar, an increasingly importance destination for Thai investors, and could begin to sway the Mekong region more into its orbit and away from China and its ineffective belligerent territorial policies.

Malaysia could be well positioned in the new order to dictate policy.

“Seven out of twelve of the TPP members have FTAs with Malaysia,” said Fiedo Rosli of the Institute of Strategic and International Studies Malaysia.

“Early membership gives us great bargaining power,” he added.

Although there is still objection by Malaysia NGOs and Bumiputera-linked groups, Rosli feels the TPP could be a win-win.

“Sign or not, Malaysia gains in many areas, including cap building of trade negotiators,” Rosli said.

He added: “Subsidy rationalisation is already in the government’s agenda, but [it has been] snail-paced. The TPP could inject sense of urgency.”

Ultimately, the fate of the US-lead trade treaty is still unknown in ASEAN, but Mr Rosli poses an insightful question.

“Win or lose is a highly debatable [matter] at this point, but do we know the cost of NOT being a member of the TPP?”

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