CAP Urges the Malaysian Government Not To Sign the TPPA — The Trade Deal That Will Rob Our Future

The Trans-Pacific Partnership Agreement (TPPA) text was finally released on 5 November 2015. This comes almost five years after Malaysia joined the negotiations, during which the Consumers’ Association of Penang (CAP) had consistently called for disclosure of the text. It is unconscionable that the government has negotiated an agreement that will greatly impact the lives of all Malaysians in secret, for so long.

Yet, the two cost-benefit analyses and national interest analysis that the Ministry of International Trade and Industry had promised to carry out and disclose, are only going to be made available in about two weeks time. The pledge to do so was actually made more than two years ago. It belies all understanding that the government should fail to release these documents, when – at least even in preliminary form – these should have been carried out and made public before entering into the negotiations.

There are more than 6,100 pages making up the TPPA text. Detailed analysis of the text will take some time, but already we can point to several adverse impacts for Malaysia.

— The TPPA’s Intellectual Property Chapter would enable pharmaceutical companies to maintain higher prices for their medicines for longer periods and constrict the supply of cheaper, generic equivalents. Of particular concern is the new obligation for Malaysia to provide five years of market exclusivity for biologics medicines (derived from proteins isolated from plants, animals and micro-organisms), even if there is no patent, thus preventing cheaper ‘biosimilars’ from entering the market. Many cancer medications are biologics, including the breast cancer medicine Herceptin. This branded medicine costs a total of RM136,000 for the entire treatment, putting it out of reach of the average Malaysian. Cheaper biosimilars are desperately needed to save lives, and the TPPA will prevent such medicines from entering the market earlier.

— The Investment Chapter is designed to protect and promote investors and their investments. The investor-state dispute settlement (ISDS) regime is alarmingly lop-sided in favour of large multinational corporate interests, giving them extensive rights to challenge government measures. On the flip side, there is no equivalent mechanism for the same investors to be held accountable should their acts harm the environment or if they commit human rights abuses. The burden of such lawsuits against the government could be astronomical, given that previous awards to investors have been to the tune of millions. Even more worrying is the potential that the mere threat of such a lawsuit could deter government from regulating in the interest of our health and environment. Although the TPPA at face value contains provisions that allow states to retain their rights to regulate for public health and interest, these rights have to be exercised in a matter that is consistent with the government’s other investment obligations towards the investor. The net result is a loss for Malaysians at large.

— The Intellectual Property Chapter also contains the obligation for Malaysia to ratify the International Convention for the Protection of New Varieties of Plants 1991 (UPOV 91). UPOV 1991 is against the interests of our small farmers and requires Malaysia to change its laws and policies to comply with the bad provisions of UPOV 1991. Our existing Protection of New Plant Varieties Act 2004 allows small farmers to exchange farm-saved seeds amongst themselves and to sell such seeds under certain conditions. UPOV 91 would not allow this. Changing Malaysia’s law to conform to UPOV 91 would give seed companies longer monopolies; prohibit farmers from exchanging and selling seed that they have saved, and remove its biosafety protections and anti-biopiracy provisions.

— The chapter on state-owned enterprises establishes a framework that will have far reaching consequences for the future operations of government-linked enterprises in the future. This framework is going to raise many constraints on how state enterprises are allowed to operate in the future and this will have a major impact on Malaysia’s political economy and social development.

— Proponents of the TPPA have claimed that it will protect workers in Malaysia and promote their welfare and interests. These include requirements on minimum wages, hours of work, and trade in goods made by forced labour. Yet, the TPPA fails to patch up the biggest hole of all: apart from the right to create independent unions, all other provisions to protect or promote worker rights lack ‘teeth’ in the sense of decisive and effective enforcement. So the fierce dragon that many had thought would serve as protector and promoter of workers in TPPA countries in the end has only one tooth. To add insult to injury, the Investment Chapter can be used to challenge labour rights, for example, Egypt has been sued under ISDS for raising its minimum wage.

There are many other concerns with the TPPA. For example, the WTO-plus copyright provisions will keep educational materials unaffordable for longer. There are also implications on our biosafety regulations that have been set up to protect us from the potential adverse impacts of genetically modified organisms (GMOs), and our ability to prevent the biopiracy of our rich biological resources.

Therefore, once again, CAP repeats our call to the Malaysian government not to sign the TPPA.

Press Release, 9 November 2015