THE signed by unratified Trans-Pacific Partnership trade deal will create major opportunities for supply chain providers and some key south-east Asian economies, delegates to a Malaysian shipping conference were told.
But political opposition in Malaysia could result in the country not being ready to benefit of the deal and have rival Vietnam benefit instead, said other experts.
Speaking at the fourth annual Global Logistics and Supply Chain Symposium in Malaysia, M Power Associates logistics consultant Mark Millar said opportunities would vary, reported Lloyd's Loading List.
"There will be winners and losers," he said. "The TPP is a lot broader and deeper than many of the free trade agreements so far
"For Brunei, Singapore, Malaysia and Vietnam that are in both AEC [ASEAN Economic Community] and TPP, I can only see positives, especially for their exports because they can export duty free in TPP, whereas China cannot," he said.
TPP promises to eliminate more than 18,000 tariffs between 12 of the most important and fastest-growing Pacific nations that together are responsible for nearly 40 per cent of global GDP.
Deborah Elms, executive director of the Singapore-based Asian Trade Centre, said she expected TPP to enter into force in mid-2017 and insisted the benefits would transcend the signatory countries and the companies headquartered there.
"European companies producing in Malaysia and Vietnam are in TPP," she said. "Where your company is registered is not relevant; what matters is where you produce."
Ms Elms said the vast scope of TPP across services and goods movements covering most industry verticals as well as intellectual property and e-commerce, would offer benefits for all member countries, and would open up vast new markets, for supply chain service providers.
She also argued that Vietnam and Malaysia were particularly well placed to prosper. "Both have protected markets, and TPP will mean domestic changes," she said. "But both are also economically competitive, so they can do very well."
But Malaysian political opposition to the deal, which could see the country not fully prepared to participate when TPP goes live, could carry a heavy economic penalty.
"If Malaysia doesn't enter on time, then Vietnam will capture most of the gains. And once companies move to Vietnam, they are unlikely to leave. For Malaysia this is a one-shot opportunity," Ms Elms said.
Mr Millar said with input costs for production in China rising, there was now a clear view of how manufacturers were adapting and this would also create opportunities for those countries plugged into far-reaching trade deals such as TPP.