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Malaysia looks to China trade pact to bolster trade
[KUALA LUMPUR] Malaysia said on Tuesday it would focus efforts on wrapping up a multi-nation trade pact led by China, as the South-east Asian country braces for the possible collapse of the Trans-Pacific Partnership (TPP), spearheaded by the United States.
The comment comes after US President Barack Obama's administration suspended efforts to win congressional approval for TPP before President-elect Donald Trump takes office, saying the pact's fate was up to Mr Trump and Republican lawmakers.
Trade Minister Mustapa Mohamed said Malaysia was looking to push the Regional Comprehensive Economic Partnership (RCEP) - mooted by China as part of its outreach to the 10-member Association of South-east Asian Nations (Asean).
"The current uncertain international economic situation has motivated and strengthened the resolve of RCEP countries, which are among the fastest growing countries in the world, to continue working closely in reaching a conclusion of this trade agreement," Mr Mustapa said in a statement.
Mr Trump vowed to scrap the TPP several times during his campaign.
Mr Mustapa's statement follows a raft of US$34 billion worth of bilateral deals signed between Malaysia and China, in what is seen as a shift towards the Asian giant, and away from the United States.
The deals were signed during a visit this month to China by Malaysia's Prime Minister Najib Razak, who said ahead of the week-long trip that it would push ties between the two nations to "new highs".
The TPP can only proceed if the United States, which "constitutes about 60 per cent of the total TPP members' GDP", remains part of the deal, Mr Mustapa said.
It can only take effect if ratified by at least six countries that have GDP making up 85 per cent of the total GDP of the 12 countries in the pact, he added.
"There will be no TPPA without the US' participation."
Signed in Oct 2015 after more than five years of negotiations among the 12 Pacific Rim signatories, the TPP aims to cut trade barriers in some of Asia's fastest-growing economies and boost ties with US allies in the region, in the face of China's rising influence.
Mr Mustapa said a clearer picture on the state of the TPP was expected to emerge during discussions on the sidelines of next week's Apec Summit in Lima, the Peruvian capital.