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TPP Agreement lays foundation for development and employment in member countries

TPP Agreement lays foundation for development and employment in member countries

Oct 15,2015

Ten of the Trans pacific countries such as Malaysia, US, Japan have reached to a final agreement on the largest regional trade in the world history. The Trans-Pacific Partnership Agreement (TPP). It initiates a regional economic platform which integrates across the Asia Pacific Region.

TPP main aim is to design, high quality agreement which is inclusive of foundation for the growth of economy. This will enable the development which will create employment in the group countries like Australia, Brunei, Chile, Singapore, Mexico, Vietnam and New Zealand.

Including Malaysia many countries claim that this is very high controversial trade agreement and the TPPA has to be agreed by the entire member collectively. 

Many member countries civil societies are concerned on its impact on the cost of medicine and investment disputes on property rights as the agreement favor on investors to sue the governments outside the national laws. Debate on this expected in the coming months.

For Malaysia, this TPPA agreement will be its first free trade that has a Labor Chapter which represents economic integration with recognition to a sustainable and fair agreement. The basic objective is development in economic activities which generate employment opportunities.

The countries of the TPPA included Labor Chapter on a high level of obligations which require TPP countries to incorporate the four principles of the ILO Declaration of 1998, in the laws of each country.

This chapter compels Malaysia to recognize the right in bargaining and freedom of association. This abolishes the current trade unions restrictive Union Act 1959 which is divided by industry, enterprises, establishments, job functions as per discretion of the Director General of Trade Unions which resulted in a weak labor movement with low wages.

Malaysian Government allowed employers on low wages to suppress the trade unions, unless there is no economic benefit to the employer to invest on technology or productivity methods which resulted in low cost, productivity and high rate of foreign workers.

Malaysia GDP (gross domestic product) wages is only 33.6%. While it is 46.2% in Taiwan, 43%  in Singapore, it is 51.3% in Norway, 43.7%in South Korea, 51.9% in Japan, and 48.7% in Australia.

Government aim is to increase the wages of GDP from   33.6% to 40% which will  transform economic policy thrust for a high-income with a goal of US$15,000 per capita income by 2020.This was implemented in 2012 , but did not ensure to increase the minimum wages in par with productivity. It is up to the worker to negotiate on the performance and productivity. With this, investors are going back in implementing new technology for fear of increase in wages.

Countries who implemented trade unions are most competitive with high productivity.

Labor Chapter is a very positive drive towards high-income economy. This should help to balance between employer and worker.

As told by Andrew Lo of Sarawak Bank Employees Union CEO and secretary of Malaysian Trades Union Congress Sarawak division.


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