COMMENT There has been much confusion among trade unionists and opponents of the Trans-Pacific Partnership Agreement (TPPA) on whether to support the TPPA in view of Chapter 19, the Chapter on Labour, and the agreed side letters on US-Malaysia Labour Consistency Plan within the agreement.

For trade unionists, most of the provisions in the Labour Chapter, and especially the side letter between Minister Mustapa Mohamed and United States Trade Representative Michael Froman, should be welcomed with open arms, as finally the Malaysian government would be "forced" to comply with many of the demands that trade unions and civil society organisations have been fighting for all these years.

We cannot deny that the US has just "made an offer we cannot refuse" to Malaysian workers through the TPPA, as it would greatly uplift their rights and the rights of migrant workers as well, which have been trampled upon all these years. Among the savoury items in the agreement are;

Amending all necessary laws that would ensure full implementation and enforceability of the International Labour Organisation (ILO) declaration on Fundamental Principles and Rights at Work and its follow-up, as adopted by the International Labour Conference at its 86th Session in Geneva on June 18, 1998 (Annexe revised on June 15, 2010)
Ensuring trade unions have the right for judicial review against administrative decisions regarding trade union registration, suspension, cancellation and determination of strike illegality;
Removal of the discretionary powers of the Director-General of Trade Union on issues of union registration;
Removing limitations on forming trade unions in the same trade sector;
Outsourcing and employment agencies – better regulations to ensure worker rights;
Ensuring that employers cannot hold the passports of foreign workers;
Levy is the responsibility of the employer and should not be charged on the worker; and
Special passes by Labour Department for workers involved in industrial disputes, enabling them to remain in the country and seek alternative employment till their cases are settled.

In terms of enforceability, Malaysia is required to enact all legal and institutional reforms prior to the date of entry to enforce the TPPA.

Malaysia can comply with ILO standards, without TPPA

It is rather ironic that the Malaysian government’s political will to enhance our domestic labour rights has to be "whipped" upon us by the US through a trade agreement.

Our government has, for decades, played deaf to various petitions, protests and complaints demanding the same rights as listed above from workers, political parties and trade unions.

Malaysia has ratified a total of 17 ILO Conventions involving Forced Labour, Right to Organise and Collective Bargaining and the Equal Remuneration Convention, among others. All of these have been ratified and enforced even before TPPA.

So what is stopping us from amending our labour laws, enhancing and enforcing them effectively?

TPPA: 30 Chapters – take all or none!

So now the question: should we support the government’s decision to sign the TPPA or not? If Malaysia has the option to pick and choose to sign the Labour Chapter only, we believe most workers and unions would welcome it.

But unfortunately, that is not the case. The TPPA consists of 30 chapters, ranging from National Treatment, Market Accesses, Rules of Origin to Textile and Apparel, Investment, Intellectual Property and many more.

The Labour Chapter is the sugar coating on the bitter medicine that we are about to swallow! Various analyses and articles by local and international experts have researched and proven the negative implications of the TPPA.

Implications on workers from the chapters

Besides enhancing workers’ rights via the Labour Chapter, workers will lose their rights to decent affordable healthcare (due to delayed entry of generics and maintained high prices of medicine), increased cost of education (with tougher intellectual property rights) and many other indirect implications through the other chapters in the TPPA.

The crux of the TPPA is tariff elimination and liberalisation of trade. How will local small and medium enterprises (SMEs) be affected by the elimination of tariffs on import products, in direct competition with our local products?

The president of the SME Business Associations, Michael Kang Hua Kuong, was quoted in TheStar on Nov 23 that nearly 30 percent of the registered 650,000 SMEs in Malaysia will be out of business in two years’ time if the TPPA is signed. With 80 percent of our workforce employed in SMEs, we could well see an increase in unemployment.

Even though some might argue that there will be increase in employment with an increase in trade and exports, the experiences in Africa, Latin America and South Korea have shown otherwise.

A report from the US Economic Policy Institute, titled “No Jobs from Trade Pacts: The Trans-Pacific Partnership Could Be Much Worse than the Over-Hyped Korea Deal By Robert E Scott” dated July 18, 2013, explains:

The tendency to distort trade model results was evident in the Obama administration’s insistence that increasing exports under South Korean-USA Free Trade Agreement (Korus) would support 70,000 US jobs. The administration neglected to consider jobs lost from the increasing imports and a growing bilateral trade deficit. In the year after Korus took effect, the US trade deficit with South Korea increased by US$5.8 billion, costing more than 40,000 US jobs. Most of the 40,000 jobs lost were good jobs in manufacturing.
There was also a big gap between predictions and outcomes for the North American Free Trade Agreement (Nafta) enacted in 1994: Nafta was supposed to create 200,000 new jobs through increased exports to Mexico but, by 2010, growing trade deficits with Mexico had eliminated 682,900 US jobs, with job losses in every US state and congressional district.

Unfortunately, our Human Resources Ministry has not done any thorough analysis on which industrial sectors will see a net increase in employment and others that will suffer due to direct competition.

In terms of benefiting from the Labour Chapter of the TPPA, you will first need to have a job! What is the use if the TPPA has caused you to be laid off?

Thus, PSM cautions all those in favour of the TPPA Labour Chapter to not to lose sight of the bigger picture of the TPPA to promote corporate agenda and enhance investor rights in the region.

In the long run, it will be the common working people who will stand to lose if Malaysia signs the agreement. At the end of the day, we have to analyse the nett benefits of the agreement in total, even if we stand to benefit from the Labour Chapter.

PARTI SOSIALIS MALAYSIA ( PSM ) is an independent political party.