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Govts must get trade priorities right after failed TPPA

January 26, 2017

Future trade pacts must ensure affordable medicine for all; job security with high wages and sustainable jobs with sufficient worker protection.

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By Charles Santiago

US President Donald Trump has signed an executive order formerly withdrawing the US from the Trans-Pacific Partnership Agreement (TPPA), a multi-lateral trade agreement involving twelve countries, negotiated over a seven-year period.

The demise of the trade deal was largely the work of resistance and protest of ordinary citizens, political parties, workers and their trade unions, farmers, consumers and public healthcare proponents including patient care groups and academics – mobilised against the trade agreement in a majority of the countries that were involved in the negotiations.

These groups argued that the TPPA promotes interests of big business, including big pharma, and were incensed by special privileges given to corporations to sue governments that would violate human rights, including workers’ rights.

Trump’s executive order seals any hope of reviving the trade agreement that was signed off by the twelve countries in New Zealand on Feb 4, 2016.

But Malaysia seems to have other plans.

Its ministry of international trade and industry has put forward three trade strategies in the face of Trump’s decision.

These strategies include improving and strengthening trade within the ten-nation Asean Economic Community; focusing on the on-going Regional Cooperation of Economic Partnership involving 16 nations; and to tie-up bi-lateral trade agreements with TPPA countries that do not have Free Trade Agreements (FTAs) with Malaysia.

During the US presidential primaries, Senator Bernie Sanders led the charge against the TPPA, arguing that it protected and promoted the interests of big business over the interests of ordinary American citizens.

But it was Trump’s carefully crafted election campaign that captured the imagination of the American voters who believed that their job losses, soaring prices of life-saving medicine, and stagnant wages would be the result of unfair trade agreements and practices.

This group believed that the rich benefited from economic globalisation whereas the ordinary people faced wage stagnation and job insecurity.

Ironically, the American white working class voted for a candidate who was hardly sympathetic to the working class or the plight of the poor.

And a flamboyant billionaire has been elected to address the plight of the American working class.

Similar sentiment was observed in the UK’s unexpected Brexit vote.

Despite the outcome of the US election and Brexit, other key players in the TPPA, such as Australia and New Zealand, have proposed a “TPP minus 1” approach and possibly to include countries like China and Indonesia in keeping the trade agreement alive.

The government of Chile is calling for a March meeting among the remaining 11 countries to figure out the future of the trade agreement.

Press reports indicate that both China and South Korea would be invited for the meeting.

These countries should view Trump’s victory as a wake-up call against the nature and character of the global economic order in which free trade agreements are structured.

His victory shocked the pollsters most. Democrats lost both at the Senate and Congress.

The political backlash against the party in power was shocking to say the least.

American voters vented their anger – economic and job insecurity, including twenty years of wage stagnation – with an unpredictable vengeance.

And now, there is a fear that Europe might face a similar outcome in the coming elections, especially in countries like France and Germany.

Growing inequality and job insecurity, including wage stagnation and loss of the welfare state, could lead to a stronger showing of the right-wing parties in the coming elections. Its obvious people are desperate in the way they articulate their unhappiness and discontent.

But what is certain is that at the heart of the disenchantment, lies unequal economic arrangements that result in profits accruing to the rich and low wages, job insecurity and wage stagnation for the poor.

Put simply, the unequal relationship that present day globalisation creates has to be addressed. Low wages and a race to the bottom FTA strategies are no longer tenable.

So instead of jumping into another trade agreement, governments in the developed and developing countries, including Malaysia, should re-examine the nature of trade agreements that are being negotiated.

It cannot be about protecting corporate interests alone.

People matter.

Thus, governments should sit back and draft Intellectual Property Rights (IPR) regulations that ensure affordable medicine for all; job security with high wages and sustainable jobs with sufficient worker protection and the likes.

Governments will do themselves a favour by learning from the popular revolt against President Barack Obama’s TPPA.

It did not benefit his party or Hilary Clinton, who lost against Trump.

Charles Santiago is the Member of Parliament for Klang.

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