Ratification Politics and Preferential Trade Agreements: Malaysia and the CPTPP

Ratification Politics and Preferential Trade Agreements: Malaysia and the CPTPP

By
Nikhar Gaikwad, Kenneth Scheve, Elisabeth van Lieshout
2019|Case No.P99| Length 36 pgs.

What does the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) mean for a country like Malaysia? This case investigates the far-reaching domestic ramifications of this type of “mega-regional agreement,” as well as how international agreements can be an important way to strengthen alliances and global standing. The case asks students to evaluate an important decision facing Prime Minister Mahathir Mohamad, a long-serving former prime minister who surprised everyone by winning Malaysia’s May 2018 election. Having come out of retirement to secure his legacy, Mahathir faces a complicated political choice. The previous administration had signed on to the CPTPP, and signatory countries must now pass the deal through their respective domestic approval processes. But Mahathir’s party and government are divided on the deal, which could bring new export and investment opportunities – but also would require Malaysia to make commitments to protect labor rights and intellectual property. These commitments, in turn, could prove politically unpopular at home.

Learning Objective

The case study asks students to advise on a decision that could alter Malaysia’s economic and political position in the world – should Malaysia ratify the CPTPP as it currently stands? Should Malaysia try to draw the United States back into this regional trade agreement, or push for China’s participation. Is there a way to renegotiate the deal to keep Malaysian businesses happy, but also address concerns by farmers, environmental groups, and human rights activists?

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