Exiting TPPA would bankrupt Malaysia, says Dr M

PETALING JAYA: While Malaysia could technically get out of the Trans-Pacific Partnership Agreement (TPPA) anytime it wanted, such a move would bankrupt the country due to litigation costs, says Tun Dr Mahathir Mohamad.

In a statement on his blog on Thursday, the former prime minister cautioned that it would not be so easy for the country to extricate itself from the treaty as was said by International Trade and Industry Minister Datuk Seri Mustapa Mohamed.

Dr Mahathir explained that all parties who would lose profit, even future profit, from such a decision would be able to sue the Government as part of the treaty’s agreements.

“In the TPPA agreement companies can sue the Government for loss of profit including future profit if Government action results in the loss,” he said.

He gave the example of a Latin American country where the government was sued for several billion US dollars for stopping a mining operation granted to an American company over reasons of pollution.

“A decision to withdraw from the TPPA will obviously result in loss of profit and future profits by companies investing in Malaysia or trading with Malaysia.

“The withdrawal will involve numerous companies and the purported loss will run into hundreds of billions,” he said, explaining that the courts would not be Malaysian and so would harbour no sympathy for our economy and finances.

“There is also no way we can pressure or bribe the courts. We will just have to pay the billions,” he added.

Dr Mahathir said that the TPPA was not for promoting free trade, but rather for regulating trade.

He explained how Malaysia needed no such treaty before this when it became the seventeenth largest trading nation in the world.

“We were free to protect ourselves and to devise policies beneficial to all of us Malaysians.

“We grew fast at that time. We traded with whomever we liked,” he said.

The TPPA is a multi-lateral free trade agreement that encompasses 12 countries –

Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, Vietnam and Japan.

Under the TPPA, Malaysian businesses will have access to other TPPA countries’ markets while companies from those places can also apply here.

Concerns have been raised that such a treaty would limit Malaysia’s sovereignty and its ability to protect its local businesses and the rights of its workers.