MTUC concerns over FTAs deepen

Online Publication Date: 14 February 2012

By Fauwaz Abdul Aziz

The president of the Malaysian Trades Union Congress (MTUC) Khalid Atan has expressed his belief that the time has come for the 800,000-strong workers’ movement to mobilise against the free trade agreements that the government is negotiating.

This is because of the many violations of rights that such agreements are likely to entail, yet have been unaddressed by the government, said Khalid.

“It is time for MTUC to act, to move” the unionist told an audience of about 100 people on February 4 at a forum on free trade agreements (FTAs) organised for congress members in Petaling Jaya, Selangor.

Khalid said the General Council of the MTUC would meet soon to deliberate on the next course of action over the European Union-Malaysia FTA and the Trans-Pacific Partnership Agreement (TPPA) that the Malaysian government is negotiating with the EU and eight other countries, respectively.

The EU-Malaysia FTA is entering its eighth round of negotiations. Ambassador and Head of the Delegation of the EU to Malaysia, Vincent Piket, had said in mid-January that he believes the agreement can be signed between the EU and the Malaysian government by the end of this year.

According to media reports, the nine TPP leaders – including Prime Minister Najib Razak – had agreed in November last year to work to complete the main text of a pact by July 2012.

The half-day forum on Sunday saw several panellists presenting on the EU-Malaysia FTA as well as the TPPA, particularly the history of lopsided provisions in favour of corporate interests and the adverse effects similar agreements have had on the interests and welfare of people, especially workers and vulnerable segments of society.

Khalid himself, in his opening address, lamented that the trade union representatives of workers who will bear the brunt of the costs of the EU-Malaysia FTA and TPPA have not been consulted by the government.

“Why are they so secretive?” he queried.

What is feared, Khalid added, is that given the negotiations between Malaysia and the other parties to the talks have lacked transparency and consultation with all stakeholders, the agreements eventually signed behind closed doors will spell disaster for workers' rights and people dependent on affordable access to medicines and medical treatment.

“What is clear is that these two advanced (groups of) countries (EU and the US), these economic giants, will assert their interests at the expense of less developed countries.”

Many during the forum were significantly irked when not one representative of the EU delegation to Malaysia, the Malaysian Ministry of International Trade and Industry or the Human Resources Ministry showed up despited having been officially invited by MTUC to present their perspectives on the issues raised over the EU-Malaysia FTA and the TPPA.

Expressing anger over the officials' absence, Khalid asked: “What are they trying to prove? What are they trying to hide from us? … Are they trying to hide certain facts so that the people are in the dark?”

Following Khalid, Member of Parliament for Klang, Charles Santiago, shared his knowledge of the development of the EU's global trade strategies and the motivations behind the EU's insistence on signing FTAs with ASEAN countries, even following the collapse of talks several years ago over a proposed EU-ASEAN FTA.

“It's the competition between EU, Japan, China and US for market access. They (EU) see they don't have a presence in Asia. That's why they're entering Asia.

“These FTAs are the battlefield for market access,” said Santiago.

He also raised concerns that government procurement as a policy tool to achieve socio-economic objectives in the interests of Malaysian companies would be unavailable following the signing of FTAs that include provisions for government procurement to be opened up to companies from those countries that are parties to the agreement.

Santiago pointed out that the government has kept mum over the possibility that it would liberalise government procurement, a proposition that would not go down well with the electorate.

In addition to the significant implications for workers following the signing of the EU-Malaysia and TPPA free trade agreements, Santiago said the likely price rise of medicines and medical treatments would have adverse consequences on Malaysians' quality of life and livelihood.

Sivarajan Arumugam from the FTA Coalition of various organizations advocating on the EU-Malaysia FTA and the TPPA, added further details relating to the actual results of trade liberalisation via tariff reduction elsewhere around the world.

Senegal, Sivarajan cited, lost one-third of its domestic jobs in manufacturing following the implementation of tariff reductions, while Zambia saw employment fall by 40% in five years following similar trade liberalisation.

In the case of Malaysia and the EU, the reduction of export taxes on Malaysian raw materials will have implications for local industries, given the high-technology capacity and production capacity of EU countries in exporting, for instance, furniture made from Malaysian forest products.

Workers in the Malaysian furniture industry face job cuts if their companies are unable to compete with EU companies importing raw materials cheaply to re-export finished products such as furniture back to Malaysia, said Sivarajan.

Malaysian furniture makers can also lose market share in the EU and third countries if it has to remove export taxes on raw materials like wood.

Lim Li Ching of Third World Network, meanwhile, warned of the consequences if Malaysia signs onto agreements that allow corporations to sue the government directly if a policy or law were put in place in the public interest but is seen by the company as infringing on their ability to maximise their profits.

She recounted the suit by tobacco company Philip Morris against the government of Uruguay for the latter's actions over cigerette packet labeling, as well as gave other examples of corporations using the investment provision of FTAs to sue governments for health and environmental regulatory measures.

Fifa Abdul Rahman of Harm Reduction International, in her presentation, noted that it is a myth that foreign investors are moved to invest in those countries that sign FTAs with the US and EU.

Foreign direct investments, according to studies, rise and fall in a country by virtue of other factors – such as its infrastructure, language(s) spoken, human resource capabities, etc. – rather than FTAs per se, said Fifa.

Edward Low of the Positive Malaysian Treatment Access & Advocacy Group (MTAAG+) raised worries over intellectual property (IP) provisions in FTAs and cited findings that medicines and medical treatment have been made more expensive following the enforcement of IP legislation as contained in such trade agreements.

Citing his own personal situation, Low pointed out that people living with HIV/AIDS are dependent on generic medicines to survive, but face a stark future if such medicines are rendered unavailable or unaffordable due to the imposition of stricter patent regulations on medicines.

Sarajun Hoda of reform movement Aliran called on members of the audience not to leave the forum without resolving to inform their family members and friends about what they had learned about the EU-Malaysia FTA and the TPPA.

Lamenting the fact that the governments of Malaysia and the EU had declined to tell their side of the story at the forum, Sarajun said that the people “cannot let the FTAs happen” without making clear their opposition.