24FocusM July 27-Aug 2, 2013

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Globally, we are one of the most open

economies so it is important that we engage in this sort of negotiation to provide more opportunities for the people, says Sta Maria

NEGOTIATORS from 12 countries seeking to hammer out the Trans-Pa-cific Partnership (TPP) agreement will be hard

pressed to come to consensus by year’s end as they try to re-solve sticking points which threaten to delay the conclusion of the deal.

As negotiations reach a crucial stage in which delicate issues such as in-tellectual property (IP) rights, market access, investment and competition are being discussed, TPP countries including Malaysia are balancing potential gains in trade volume and revenue against potential concessions they would have to make in terms of the protection of their industries and state-owned enterprises.

The talks were originally to be con-cluded in October but negotiators now intend to end talks by year’s end. “Mar-ket access is a huge issue right now,” says a negotiator at the 18th round of TPP negotiations which ended on July 25 at the Sutera Harbour Resort in Kota Kinabalu, Sabah.

Another negotiator says the new target to conclude talks by the end of the year “is not impossible but it is going to be hard”. As negotiators are bound by confidentiality agreements, they could not reveal details. Jayasiri told stakeholders on

July 20 that negotiators are now dealing with the more difficult issues

by LIM WEY WEN

Since negotiations started on July 15, the calm at Kota Kinabalu’s Magel-lan Sutera, part of the Sutera Harbour Resort, has been interrupted by the flurry of activity of over 600 delegates, 200 stakeholders as well as over 200 journalists from the 12 TPP countries.

These countries are Brunei, Austral-ia, Chile, New Zealand, Singapore, the US, Canada, Mexico, Malaysia, Peru, Vietnam and newcomer Japan, which entered talks officially on July 23.

How Malaysia gainsFor Malaysia, consideration is likely to revolve around estimated annual export gains of US$40 bil (RM127.6 bil) and US$25 bil in annual income gains by 2025, balanced against a potential

increase in the cost of medicines should certain clauses in the

intellectual property chapter be agreed on, sources say.

This is reflected in public opinion of the agreement in Malaysia, which has seen propo-

nents from the manufacturing sector, as they expect the agreement to open new markets for them within the TPP that includes the US$15 tril market.

Those who have voiced concerns in Malaysia include the generic pharmaceutical industry, groups that represent Malaysian small and medi-um enterprises, public health groups and those concerned with the survival of government-linked enterprises, as well as bumiputera entrepreneurs, due to expected intellectual-property re-quirements as well as the liberalisation of sectors of the Malaysian economy.

One of the reasons TPP talks, which began in 2010, have taken so long is the requirement that all negotiating countries reach consensus, Ministry of International Trade and Industry (Miti) secretary-general Datuk Dr Rebecca Fatima Sta Maria tells FocusM in Kota Kinabalu.

“Globally, we are one of the most open economies, so it is important that we engage in this sort of negotiations to provide more opportunities for the people. The benefit will be long-term at the end of the day,” she says.

One of the main industries that would benefit, according to source familiar with the negotiations, is the Malaysian textile industry. As the US textile market is one of the world’s largest, lowered tariffs for Malaysian textiles may result in a significant increase in Malaysian exports.

When the TPP comes into force, Malaysian exporters will see greater market access due to the reduction of duties, says Malaysian Textile Manu-facturers Association (MTMA) CEO Andrew Hong.

“The projection is a 20% or more rise [in exports] to the US with the imple-mentation of the TPP,” he says, adding that current duties imposed by the US on non-FTA countries range from 6% to 32%. “Currently our 80 members export about US$500 mil a year to the US and the country is our biggest cus-tomer,” Hong says, adding that most Malaysian manufacturers are in niche and high-end segments, compared to textile-exporting countries like China, India and Bangladesh.

Another industry representative who expressed positive views is Malaysian CropLife and Public Health Association executive director Chooi Lam Khong, whose organisation rep-resents the plant-science industry that includes pesticide manufacturers.

“Intellectual property protection gives confidence to foreign investors [who may wish to invest in the pesticide industry in Malaysia] and local compa-nies are increasingly interested in doing research and development themselves,” he says, adding that local companies that develop their own pesticides to export to TPP countries would benefit from intellectual property protection.

Miti sources also expect Malaysian small and medium enterprises (SMEs) to benefit from being part of the global supply chain with increased invest-ment and trade in the country.

What’s at stakeNotwithstanding potential gains, there are also potential downsides to the agreement if certain provisions – purportedly pushed for by the US – are accepted, say several industry groups and non-governmental organisations.

The generic pharmaceutical industry has expressed concern about the TPP agreement as it believes several clauses

Who wins, who loses in TPP dealNegotiators seek to balance trade gains and potential losses from the agreement

Continues on page 26

TPP awareness on the rise in Sabah

Sabah protesters holding a peaceful demonstration outside the venue for the stakeholder forum at the TPP negotiations in Kota Kinabalu

Chooi says local companies that develop their own pesticides to export to TPP countries would benefit from IP protection

Malaysian exporters will see higher market access due to the reduction of duties, says Hong

THE decision to hold the 18th round of the Trans-Pacific Partnership (TPP) negotiations in Kota Kinabalu has sparked protests in the state as more Sabahans are exposed to the trade negotiations.

One of the first protests, held outside the Pacific Sutera Hotel before the TPP stakeholder forum on July 20, involved up to eight political parties and Sabah-based non-governmental organisations (NGOs) and resulted in 14 arrests.

“The discussion is not that extensive in Sabah,” says Gerakan Nasionalis Sabah (Sabah Nationalist Movement) spokesperson Zainnal Ajamain at a public forum held on July 21.

Zainnal, who started to read more about the agreement just a week ago, says he views the TPP agreement as presenting two contending choices. “One views the TPP as constricting, restricting and consuming to Malaysia, especially in its regulatory and legal form,” he says.

“The other view is that the TPP can be beneficial to Malaysia because of open trading, and as a trading nation, this is a prerequisite for growth,” he says, adding that from the perspective of a Malaysian in Sabah, the TPP may be a “blessing in disguise” to make Sabah and Sarawak more resilient.

Although the awareness is still low among Sabahans, NGOs are starting to spread the word through social media platforms and the media.

“Sabahans don’t know about it but now some of us do and we need to speak about it, especially within the local Sabah media,” says Harjinder Kler, vice-president of the Sabah Environmental Protection Association.

26FocusM July 27-Aug 2, 2013

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in the leaked intellectual property chap-ter may delay the entry of generics into the Malaysian market. This may affect the speed at which it brings generic drugs to the market and the availability of cheaper drugs to the public.

One of these clauses includes the extension of the 20-year patent period for an innovator drug to make up for the time required to register a drug in a market like Malaysia’s. This clause, called patent restoration, may push back the availability of a generic version of the drug for as much as one or two years.

“Our stand is that nothing should delay the introduction of a generic after a valid patent has expired,” says Malaysian Organisation of Pharma-ceutical Industries (Mopi) president Leonard Ariff Abdul Shatar, who is also CEO of CCM Duopharma Biotech Bhd.

There are also concerns that state-owned enterprises and the govern-ment will be required to open their vendor programmes to bids by foreign companies with lower contract-sum thresholds, under the government procurements chapter.

This means that government procurements needed for stimulus, especially among disadvantaged groups, may leak to foreign com-panies, argues Sanya Reid Smith, legal adviser and senior researcher at international non-governmental

Malaysian farmers unable to compete with foreign multinationals

organisation Third World Network.Other industries that may face chal-

lenges include the agriculture sector as well as the services sector – which includes banking, insurance, health-care and education, says Reid Smith at a public forum in Kota Kinabalu.

These sectors will be open to foreign competition unless Malaysia lists these sectors as exceptions in the agreement – a move that needs to be agreed to by all the other TPP countries.

As the US heavily subsidises its ag-riculture industry, there are concerns Malaysian farmers may not be able to compete with huge foreign multina-tionals if the sector is liberalised.

From page 24 Striking a balanceDue to the secrecy surrounding ongoing negotiations, it may be difficult to evaluate the positive and potential negative outcomes for Malaysia.

However, negotiators from all countries agree they are trying to strike what some of them call the “golden balance” to promote trade and protect their nations’ interests.

“In the process of negotiating, we try and find the best formula that would work for us without having to compromise on sensitive policies and our sovereignty,” says Sta Maria.

Sta Maria says all negotiators would want to protect their policy space and right to regulate.

It is yet to be seen if developing nations in the TPP will successfully negotiate terms more aligned with their interests when faced with strong developed nations such as the US, Japan and Australia.

While TPP negotiators typically meet every two or three months, ne-gotiators are considering holding the 19th round of negotiations in Brunei as soon as next month.

This is in line with Malaysia’s chief negotiator J Jayasiri’s comments at the 18th round stakeholder briefing on July 20 that negotiators are now dealing with the more difficult issues and intensify-ing negotiations on issues like market access.

Malaysia yet to make any concessionsALTHOUGH the Trans-Pacific Partnership (TPP) is targeted to be concluded by year-end, it is too early to confirm the sectors that will be carved out from the agreement, says the Ministry of International Trade and Industry (Miti).

Miti secretary-general Datuk Dr Rebecca Fatima Sta Maria told FocusM that the negotiators are still discussing those issues.

She says the ministry has not made any concessions in the TPP that are different from its other agreements.

A look at Miti’s brief on the TPP reveals that Malaysia has carved out the build-operate-transfer part of government procurement and excluded areas of interest to the bumiputera business community in its initial offer. As for state-owned enterprises, Malaysia is seeking flexibilities in the agreement that will allow the continued existence of such entities.

Zainnal says the discussion about the TPP in Sabah is not yet particularly extensive

Reid Smith says government procurement needed for stimulus may leak to foreign companies

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Trade competition brewing in AseanMalaysia is negotiating trade pacts with two economic giants. Which deal is better?

WITH the Trans-Pacific Partnership (TPP) negoti-ations expected to be con-cluded by year-end and the Regional Comprehensive

Economic Partnership (RCEP) by 2015, Malaysia is negotiating trade deals that involve the world’s two economic giants – the US and China.

The nature of both negotiations is rather different, and Malaysia’s Minis-ter of International Trade and Industry recently indicated that Malaysia will prioritise the US-led TPP over the Asean-initiated RCEP talks with China as the former has been going on for three years.

However, even before the RCEP ne-gotiations started in May, economists and researchers have been weighing the potential impact of the two trade pacts on the region, and Malaysia in particular.

Part of this discussion is fuelled by the obvious absence of China in the TPP negotiations and the US in the RCEP talks, sparking observations that the trade pacts will eventually become a competition for a greater market space between the world’s two top economies.

Malaysian economist Dr Shankaran Nambiar, in a February commentary in a local daily, likened Malaysia’s involvement in both negotiations as a situation where “[Malaysia] is happy to be caught between two stools, and to distribute its scarce resources negoti-ating both agreements”.

“Since the TPP and the RCEP will, at some point, reveal the underlying tension between Washington and Beijing, Malaysia will then have to use its diplomatic skills to balance between their competing demands,” he wrote.

Sanchita Basu Das, a lead researcher in economic affairs at the Singapore Institute of Southeast Asian Studies (ISEAS) Asean Studies Centre, wrote in a January paper that “while it is possible that initially both TPP and RCEP may generate some competition for each other, eventually both are possible pathways to a free trade area of the Asia-Pacific”.

As the 18th round of TPP negotia-tions concluded in Kota Kinabalu on July 25, FocusM looks at the oppor-tunities and challenges that will come with both trade talks.

TPP risk and rewardThe TPP is often referred to as “an am-bitious, high standard agreement” that the US Trade Representative office says will “enhance trade and investment among the TPP partner countries, promote innovation, economic growth and development, and support the creation and retention of jobs”.

Japan became the 12th member when it entered the negotiations on July 23, at the tail-end of the 18th round.

Existing member countries include Brunei, Singapore, New Zealand, Chile,

The TPP will require member countries to conform to a standardised measure of governance based on the

developed world’s standards. That can be hard as it will require domestic reforms of laws and regulations.”

— THAM

The RCEP’s demands will be less

pressing than the TPP’s.”— NAMBIAR

Both the TPP and RCEP are equally

important to Malaysia.”— YEOH

The TPP negotiations that have been going on for three years have met with a lot of resistance among civil groups. In this 2011 file photo, Japanese farmers protested against Japan’s entry into the TPP talks

by LIM WEY WEN

US, Canada, Mexico, Malaysia, Vietnam, Peru, and Australia. Several other coun-tries, including Taiwan, the Philippines and Thailand, were also reported to be interested in joining the talks.

With Japan’s entry, the TPP ac-counts for a market of over 790 million people, with a GDP of US$27.5 tril (nearly 40% of global GDP) accounting for one-third of total world trade.

According to a Peterson Institute for International Economics study published in June 2012, Malaysia is expected to gain over US$41.7 bil in export increase and US$26.3 bil in income gains by 2025 from the TPP.

Malaysian companies, particularly textile manufacturers, are also looking

forward to greater access to the US mar-ket – an opportunity that many felt was missed when the US-Malaysia free trade agreement (FTA) talks fell through.

For some observers, the TPP may also be viewed by the Malaysian gov-ernment as an instrument to introduce difficult domestic reforms.

However, these gains need to be balanced against the potential cost the country may have to bear should certain proposals in the leaked TPP intellectual property rights and invest-ment chapters be agreed to.

Public health groups like the Malaysian AIDS Council and interna-tional NGOs such as the Third World Network have raised concerns about

the potential rise in healthcare costs if the US succeeds in pushing for longer protection of medicine patents in the TPP.

Malaysia may also be liable to mul-ti-million lawsuits under investor-state dispute settlement (ISDS) provisions in the agreement, which allow investors to sue foreign governments in inter-national trade tribunals if government legislation or regulations are deemed to be “unfair” to the investors.

One such case is the 2011 Philip Morris suit against the Australian government for its plans to make plain packaging mandatory for cigarettes from December 2012 on grounds that the latter has breached a bilateral investment treaty with Hong Kong.

At the time, Philip Morris Asia spokesperson Anne Edwards was quoted as saying: “The government has passed this legislation despite being unable to demonstrate that it will be effective at reducing smoking and has ignored the widespread concerns raised in Australia and internationally regarding the serious legal issues asso-ciated with plain packaging.”

In June, Philip Morris International and Japan Tobacco Inc also sued the Thai government over its new anti-to-bacco law that requires larger graphic warnings on cigarette packs.

Although the Ministry of Inter-national Trade and Industry (Miti) has repeatedly assured that the ISDS provisions do not take away nations’ rights to implement regulations, local NGOs such as the Malay Economic Ac-tion Council remain concerned about the possibility of foreign corporations taking the Malaysian government to court based on the ISDS provisions.

“The TPP will require member countries to conform to a standardised measure of governance based on the developed world’s standards,” says Prof Dr Tham Siew Yean, a principal re-search fellow at Universiti Kebangsaan Malaysia’s Institute of Malaysian and

27Aug 3-9, 2013 FocusM

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International Studies.“That can be hard as it will require

domestic reforms of laws and regula-tions,” she says.

As tariffs on goods in Malaysia are “already as low as they can get”, the TPP will not be about bringing down the tariff on goods in Malaysia, says Nambiar, who is also a Malaysian Institute of Economic Research senior research fellow, via email.

“It will be about market access and non-trade issues. [Some of the] prob-lematic issues include more stringent intellectual property rights, govern-ment procurement, labour standards and rights, standards, and, especially, opening up our services sector,” he adds.

RCEP’s offerIn comparison, the RCEP is an FTA between Asean and its FTA partners – Australia, New Zealand, China, South Korea, Japan and India.

“It is envisaged to be a high-quality and mutually beneficial economic part-nership agreement that will broaden and deepen current FTA engagements,” says ISEAS’s Sanchita in her paper on the TPP and RCEP.

“RCEP is likely to be more accommo-dative of the development differences of member countries, thus providing flexibility and adjusting mechanisms in reaching the common end-goals.

“In addition to liberalising trade in goods, services and investment, it will pay more attention to physical, institu-tional and people-to-people connectiv-ity and to narrowing development gaps

and will be built in response to new developments, such as the emerging international production networks,” Sanchita elaborates.

In other words, the RCEP may not be as demanding on Malaysia as the TPP. Nambiar says: “The RCEP will not make demands that are as tough as the TPP will. It is aimed at creating Asean centrality and will work towards har-monising trade within Asean and the countries that it has trade agreements with [China, India, Australia, and New Zealand].”

“The problem with the RCEP is find-ing a common denominator, since the countries at a lower level of develop-ment will have a longer list of sensitive sectors. Progress will be at a slower pace, since many countries in Asean don’t even have competition laws and policies at this point,” he explains.

In the meantime, Malaysia will have the luxury of liberalising at a more lei-surely pace since it’s ahead of the pack, Nambiar points out. “With the RCEP, the threat of engaging in reforms faster than you’re ready to is not going to arise,” he adds.

The RCEP countries are home to 3.35 billion people and have a com-bined GDP of US$21.1 tril – 49% of the world’s population and about 30% of the world’s GDP.

What does this mean for Malaysia?Asked which agreement will benefit Malaysia more, Tham says: “In the economic arena, a simple way is to

The Trans-Pacific Partnership agreement and Regional Comprehensive Economic Partnership at a glance TPP RCEPMember countries Brunei, Singapore, New Zealand, Brunei, Cambodia, Indonesia, Chile, US, Canada, Mexico, Malaysia, Laos, Malaysia, Myanmar, Vietnam, Peru, Australia, Japan Philippines, Singapore, Thailand, Vietnam, China, Japan, South Korea, Australia, India, New ZealandPopulation 795.5 mil 3.353 bilCombined GDP (2012) US$27.5 tril US$21.1 trilCombined merchandise US$9.5 tril US$10.1 tril trade (2011)

Sources: World Bank, World Trade Organisation, RCEP and TPP: Comparisons and Concerns by Sanchita Basu Das

compare the size of the TPP market with that of the RCEP.

“Of course, this is quite simplistic as there are tradeoffs for the TPP between more market access and more trade rules that are difficult to quantify.”

As the contents of the two agree-ments are not known yet, it is difficult to draw conclusions on the advantages or disadvantages of the pacts, Tham adds.

Asian Strategy and Leadership Institute (Asli) CEO Tan Sri Dr Michael Yeoh says both the TPP and RCEP are equally important for Malaysia.

“With the RCEP we get (an FTA with) China and India whereas with the TPP we get an FTA with the US. All three countries are important markets for Malaysia,” he says, adding that he does not think China will join the TPP talks for the time being.

It may take some diplomatic

navigation to balance the geopolitical implications of both agreements, but as a trading nation Malaysia’s partici-pation in both talks is significant. “The TPP and RCEP will create mega free trade areas. Both are likely to become the world’s biggest or second-biggest FTA,” says Yeoh.

Japan’s entry to the TPP talks has been welcomed by TPP member coun-tries such as New Zealand as the move is viewed as a balancing factor to the negotiations which are thus far viewed as “US-led”.

TPP negotiators aim to conclude their talks by the end of this year and RCEP negotiators have 2015 as their target. The achievement of these targets will depend on how quickly negotiators can agree on positions that would bring more benefit than harm to everybody.

DEC 7-13, 2013FOCUSM14 mainstream

US courts Malaysia as TPP resistance persistsTrans-Pacific Partnership Agreement issues yet to be ironed out

IT had rained all day on Dec 3 when US Trade Representative Michael Froman sat on the couch in the Hilton Kuala Lum-

pur lounge for a 15-minute, evening interview with two Malaysian press members.

Despite the gloomy weather and horrendous KL traffic, Froman has already met at least three min-isters including Prime Minister Datuk Seri Najib Razak and Inter-national Trade and Industry Minister Datuk Seri Mustapa Mohamad, the parlia-mentary caucus for the Trans-Pacific Partnership Agreement (TPPA), as well as Khazanah Nasional officers, in back-to-back meetings since early morning to discuss the controversial trade deal.

“It was a good day and I was honoured to see the prime minister, knowing what a busy time this is here in KL,” says Froman, rattling off an impressive list of Malaysian officials he had met during the day.

“I met with Khazanah as well today, so it has been a very productive day in terms of sharing perspectives on priority issues, sensitivities for each of us and the possible ways forward to resolve outstanding issues; so that Malaysia and the US, together, can work to bring the TPP to a successful conclusion,” he adds.

This is the second time the trade representative is in town, just over a month since his first visit to Malaysia on Oct 11 with Secretary of State John Kerry and Secretary of Commerce Pen-ny Pritzker; the occasion then was the Global Entrepreneurship Summit. Fro-man is en route to Bali to participate in Dec 4’s Ninth Annual World Trade Organisation Ministerial Conference.

Before the trip to Malaysia, he was in Japan and Vietnam for government meetings on the TPP. He is expected to join 11 ministers from other TPP countries for a ministerial meeting in Singapore on Dec 7.

While some reports viewed this as a sign of strengthening US-Malaysia ties, the increasing attention to this part of the world, just months after US Vice-President Joe Biden bypassed Malaysia on his trip to the Asia-Pacific in July, is viewed rather differently by Malaysian lawmakers.

Wong Chen, an opposition-bench member of the Parliamentary Caucus on the TPPA, came out of the meeting with Froman with the impression that the US is very confident the Malaysian government will sign the agreement. However, he acknowledged there may be nagging worries that the balance could tip the other way.

“They are very worried about Ma-laysia and that’s why they are spending so much time here,” he says.

“As far as Pakatan Rakyat members of the Parliamentary Caucus (for the TPPA) are concerned, we are un-convinced of the benefits of the TPPA for Malaysia. For us, the negatives outweigh the benefits,” says Wong, who could not reveal details due to a non-disclosure agreement signed upon participation by all members of the caucus.

Growing resistanceSignificant resistance against the TPP in Malaysia started in the middle of

Froman says the TPP is not about competition with any country

Wong says the US is very worried about Malaysia not signing the TPPA, which is ‘why they are spending so much time here’

Farmers hold a banner as they take part in a rally against Japan’s participation in negotiations for the US-led Trans-Pacific Partnership

In July, protesters in Kota Kinabalu make their feelings known

Anas Alam ... Bantah TPPA does not want the investment chapter

2012, when a group of health NGOs issued a joint statement against the agreement as they maintained some of the demands said to be made in the agreement would prolong the time needed to make affordable generic medicines available for the masses.

These demands include an ex-tension of patents and limitations on the use of clinical data, which in combination may delay the availability of generic medicines by at least a year.

Dissenting voices became louder in June before the 18th round of TPP negotiations in Kota Kinabalu on July 15, when Malaysian NGOs came together to form the Bantah TPPA coalition, which consists of 60 NGOs and nine coalition councils including the Malaysian Aids Council, Malaysian Council for Tobacco Control, Malay Economic Action Council and Malay-

sian Trades Union Congress.In September, the coalition sub-

mitted to the prime minister its 75 “red lines” – negotiation-speak for non-negotiable positions – to ensure that even if the TPPA is signed, it will not cross these lines deemed detrimen-tal to public health and the Malaysian economy.

“One of the key issues is the invest-ment chapter,” says Anas Alam Faizli, co-founder of Bantah TPPA.

“Our stand is we do not want the in-vestment chapter but if they still want to sign the agreement with the chap-ter, Malaysia should not agree to an investor-to-state dispute settlement (ISDS) mechanism, as this may allow corporations to sue the Malaysian gov-ernment [in international arbitration tribunals],” he adds.

The effects of this provision have

been experienced by countries such as Australia, Peru and Uruguay. One of the latest cases occurred in 2011, when tobacco manufacturer Phillip Morris International launched a trade case against Australia on the grounds the country’s proposed plain cigarette-packaging legislation is in breach of Australia’s 1993 bilateral investment treaty with Hong Kong.

Phillip Morris has launched similar trade litigation against Uruguay.

While the Malaysian Ministry of International Trade and Industry (Miti) recognises that Malaysia could benefit from estimated annual export gains of US$40 bil (RM127.6 bil), it is aware of the potential increase in the cost of medicines and other concerns brought up by the NGOs.

Miti’s Mustapa was quoted in the press as he reassured the Malaysian public that matters pertaining to the TPP will be brought to Parliament for debate after negotiations are conclud-ed. He also reportedly pledged that Parliament would have the final say on whether Malaysia signs the TPPA.

It’s not about ChinaAbout whether the agreement was the US way of gaining an economic foot-hold in the region in competition with China, Froman says the TPP is “not about competition with any country”.

“The US is a Pacific power, has al-ways been a Pacific power [and] views itself as very much part of the Asia-Pa-cific region, as part of our rebalancing strategy towards Asia.

“The TPP is one of the most concrete manifestations because we very much view our economic wellbeing in the US as intertwined with the economic wellbeing of Malaysia and the other countries in the region,” he says.

Asked to comment on how the US plans to convince the world that the TPP is not “Nafta on steroids” as claimed by detractors, Froman says the agreement is a part of the Obama administration’s new approach to trade, which takes the lessons of Nafta (the North American Free Trade Agree-ment) and builds on them.

“That is why it is so important to have, for instance, high standards around labour, the environment, intellectual property rights,” Froman says.

“It is also important to deal with new issues such as the digital econ-omy, e-commerce, about the role of small- and medium-sized businesses in the global value chain; these are all new issues that go beyond where previous trade agreements have gone and establish the TPP as a 21st-century agreement.”

The US may find it difficult to prove the benefits of the agreement, as much of the 29 chapters under negotiation remain secret. What is confirmed going into the TPP ministerial meeting in Singapore is that difficult issues that remain in the intellectual property chapter are yet to be resolved.

As the end-of-year deadline for TPP talks looms, Froman acknowledges the date is an objective set by TPP leaders but declines to commit to a talk dead-line.

“I wouldn’t give an artificial dead-line,” he says.

“We’re going to work in Singapore to close out as many of the remaining issues as possible. And I think with goodwill by all the countries coming to the table, we will be able to do that.”

by Lim Wey Wen