Big firms to reap early TPPA rewards, says Khazanah Research Institute

Source: The Malaysian Insider

Khazanah Research Institute says big companies like Petronas will be the first to benefit from the Trans-Pacific Partnership Agreement (TPPA) although small and medium enterprises will not be excluded. – The Malaysian Insider file pic, November 16, 2015.

Big Malaysian companies such as Petronas, Sime Darby and UEM Group will be the early beneficiaries of the Trans-Pacific Partnership Agreement (TPPA) compared to small and medium enterprises (SMEs), said a think tank.

The observation from the Khazanah Research Institute (KRI) comes as SMEs express concern about being sidelined once the TPPA, which promises to remove trade barriers to four new foreign markets for Malaysian companies, comes into force.

KRI managing director Datuk Charon Mokhzani said big Malaysian firms would be in a better position to penetrate these new markets, namely the United States, Canada, Peru and Mexico.

However, SMEs which make up more than 95% of all Malaysian companies, could also benefit from the TPPA if they could become suppliers to these larger firms, Charon said.

Eventually, Charon said, some SMEs could also reap rewards from the TPPA when their products entered these new markets after being introduced by the larger firms.

“The overall effect of the TPPA is still complex and we are still looking at the text and working out a cost-benefit analysis to Malaysia’s economy,” Charon told reporters after a workshop “Why Trade Matters” today. Read more