Malaysia will be biggest winner in revised trade deal: Moody’s

Canada’s International Trade Minister Francois-Phillippe Champagne gestures next to Malaysia’s Minister for Trade and Industry Datuk J. Jayasiri, before signing the trade deal, in Santiago, Chile March 8, 2018.
Reuters

Malaysia has the most to gain from a landmark Asia-Pacific trade deal signed by 11 countries on Thursday (Mar 8), Moody’s Investors Service has said.

Moody’s said on Friday (Mar 9) that the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will provide Malaysia with export access into new markets, including Canada, Peru and Mexico, and will benefit palm oil, rubber and electronics exporters.

This is despite the fact that Malaysia, along with Vietnam and Japan, have the highest number of Trans-Pacific Partnership (TPP) lost trade opportunities.

The revised agreement excludes the US, whose president Donald Trump earlier sparked trade war fears by announcing a plan to impose tariffs on steel and aluminium imports.

In its analysis, Moody’s said that real incomes in Singapore, Brunei, Vietnam and Peru are expected to rise compared to a case without the CPTPP.

At the same time, economic gains for members will be smaller without the participation of the US, but export and incomes will nonetheless be boosted.

CPTPP members are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Moody’s further added in its report that if the CPTPP expands its membership to include other large Asian economies such as Indonesia, South Korea, the Philippines, Taiwan and Thailand, real income gains would be much greater and even higher than the original TPP pact.