BRUNEI Darussalam stands to benefit enormously in the long-term, particularly in its attempts to diversify the economy, following the conclusion of the Trans-Pacific Partnership (TPP).
This was revealed by the Ambassador of the United States (US) of America to Brunei Darussalam, Craig Boyd Allen, during an interview at the US Embassy in Brunei Darussalam on Tuesday afternoon.
Although the US foreign envoy was not present during the final negotiation in Atlanta, US, on October 5, he still said, “I do believe 100 per cent that over the long term, Brunei Darussalam will substantially benefit, particularly in the diversification of its economy.”
He explained that a vast amount of the nation’s economy does indeed stem from the oil and gas industry, while potential contributors in the form of small and medium-sized enterprises (SMEs) are yet to play a strong role in its growth, however, through the pact, SMEs within the Sultanate will find it much easier to export locally-produced goods to other signatory nations including Australia, Japan and the US.
The US ambassador further elaborated that “This is a ticket to larger and more complex markets. We are hopeful that Brunei’s SMEs will be able to achieve economies of scale and to export to other economies.”
As a country that has relied on trade for more than 700 years, Craig Allen said that “Brunei Darussalam is expected to benefit substantially in the long-term. Brunei has a great trading tradition going back centuries and this agreement will refresh the country’s tradition. Brunei is located strategically at the centre of Asean and is well placed for the expansion of global trade.”
Meanwhile, due to all participating countries wanting to support their local farmers, the American ambassador said, “Although I was not at the negotiation in Atlanta, I am not surprised that agricultural products were one of the most difficult issues that was resolved, and that the pact’s conclusion is a good example for the success of potential future trade agreements.”
Craig Allen pointed out that the range of TPP countries cover all economy types: Vietnam is developing and has a large and young labour force, New Zealand’s economy is based on its strong agriculture, Singapore’s is based on the provision of highly-advanced services, Japan is a booming industrial economy while Brunei possesses abundant natural resources.
This comprehensive agreement manages to accommodate countries from across the spectrum and as such, could become a model for liberation on a large scale.
The TPP will be heavily debated and voted in the US Congress within the following year, with the ambassador noting that the vote is expected to be very tight because of significant elements that both the American industry and public are opposed to, despite the release of the final documents. As the discussions, debates and possible controversies emerge following the US move toward final approval, the process is expected to take about five months.
The ambassador congratulated Brunei’s negotiators for their involvement from day one and their part in securing a historic deal with other signatory nations.
Craig Boyd Allen described the agreement as being able to help develop a global economic architecture that is open, transparent and fair, which is important because not all countries agree with these values. Since Brunei and the US have already signed several treaties of friendship, commerce, navigation and understanding over the past 170 years, he concluded that the “TPP is a natural extension of the treaty whereby both countries can further build on a strong relationship for a long time, and we welcome the opportunities.”
The ambassador also mentioned that Brunei Darussalam’s contribution to the Trans-Pacific Partnership (TPP), the biggest ever trade deal that represents 40 per cent of the world’s economy, has been significant.
The Sultanate should take pride in being one of the four founding members of the TPP agreement which was finally reached on October 5, 2015 in Atlanta, US, after years of negotiations, he said yesterday in an interview, lauding the pivotal role Brunei played in the early stages of setting the foundation for the partnership and in realising the historic accord by twelve participating nations.
The ambassador added that the announcement on reaching the agreement by the 12 participating nations of Brunei Darussalam, Chile, New Zealand, Singapore, Australia, Canada, Japan, Malaysia, Mexico, Peru, the United States, and Vietnam is timely, especially in a period of slowing global economic growth.
The ambassador cited the World Trade Organization’s recent statistics that showed there has been a significant slowdown in global trade.
“It is clear that global trade has slowed dramatically and the WTO has projected only a 2.5 per cent growth in 2015. The figure is very low and indicates that the world economy is going through challenging times. The announcement (on TPP agreement) is timely and it is very important for a number of reasons.
“This is certainly the biggest trade liberalisation agreement since 1994 when NAFTA (North American Free Trade Agreement) was completed, which is 21 years ago. TPP deal is a mega regional agreement that includes part of South America, majority of North America, significant parts of Asean, Japan, Australia and New Zealand. It includes a good number of separate regions which made it very important because the participating countries comprise 40 per cent of global economy.”
Also equally important, he pointed out, is that TPP is a 21st Century agreement which means that it is comprehensive and systematic and includes not only reduction of tariffs but also regulatory standards, intellectual property rights and competition policies. It is very board in depth but very deep in scope,” the ambassador said.
“The TPP also highlights an open architecture agreement that allows other interested countries within the APEC to partake in it which is very important for the region and a good number of countries have shown interest in joining the alliance. However, these countries will have to meet the standards and obligations set in the TPP framework,” he added.
“The sooner we could get the TPP into force, the better. If there are more countries to join the TPP, it would benefit global growth by encouraging them to improve the global supply chain as well as boost the flow of trade and investment. It will also allow for greater diversification and healthy expansion of the global economy,” Craig Boyd Allen concluded.
Source: BORNEO BULLETIN
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