Thursday, February 4, 2016

How Malaysia will benefit from TPPA

Following are some of the benefits that Malaysia will derive from the Trans-Pacific Partnership Agreement (TPPA), signed Thursday in Auckland, New Zealand. 

* Malaysia's Gross Domestic Product (GDP) is projected to increase by US$107bil (RM444bil) to US$211bil (RM876bil) over 2018-2027, which would raise GDP growth between 0.6 and 1.15% in 2027 

* Investments projected to rise by US$136bil (RM565bil) to US$239bil (RM993bil) over 2018-2027 - attributable largely to higher investment growth in textiles, construction and distributive trade 

* More than 90% of the economic gains will be attributable to lower non-tariff measures 

* Hike in export growth is projected to be outpaced by increase in import growth - therefore trade surplus is projected to narrow between 4.3 and 5.2% of GDP in 2027 

* Sectors which contributed over 20% of Malaysia’s GDP in 2014 are now expected to register higher output growth, especially the manufacturing sub-sector 

* Export-oriented firms will benefit from greater market access, especially with countries that Malaysia is yet to have a trade pact namely Canada, Mexico, Peru and US 

* Firms to benefit from access to US government procurement, greater digital liberalisation and stronger enforcement of trade secret protection 

* Wage growth for unskilled labour is projected to increase between 0.45 and 0.91% and for skilled labour between 0.38 and 0.78% 

* Investor state dispute settlement may increase cost to the Malaysian government but safeguards are in place to mitigate nuisance suits and preserve policy space in setting decisions on health, security and environment. It will also increase protection for Malaysian firms investing abroad. 

* Bumiputra and SME policies will remain unchanged.

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