MALAYSIA - US FTA [ free trade agreement ]

US, Malaysia unions rally against Malaysia-US FTA
Online Publication Date: 24 January 2007US unions rally against Malaysian pactAnil NettoJan 23, 07 United States trade unions have joined forces with their Malaysian counterparts to strongly oppose ongoing negotiations toward a bilateral free trade agreement (FTA) until workers' concerns from both countries are addressed.The American Federation of Labour and Congress of Industrial Organisations (AFL-CIO) and the Malaysian Trades Unions Congress (MTUC) are poised to ink a joint declaration agreed on in Kuala Lumpur last week. The declaration resembles those that US labour federations had previously signed with their union counterparts in South Korea last June, in Central America in 2002 and in Australia in 2001.
The Kuala Lumpur declaration asserts that economic integration between the two countries must result in broadly shared benefits for working people and communities, and not simply extend and enforce corporate power and privilege. It also warns that violations to workers' rights have reached crisis levels.The AFL-CIO is a voluntary federation of 54 national and international labour unions, representing 10 million workers in the United States.
The MTUC, on the other hand, is an umbrella movement of Malaysian trade unions representing around half a million workers.The joint declaration by the trade union movements stands in stark contrast to the floundering official FTA negotiations with Korea and Malaysia. US trade officials are struggling to wrap up their separate negotiations with both countries by March so that the drafts can be presented to Congress for approval before the expiry on June 30 of a fast-track trade promotional authority.
Malaysian International Trade and Industry Minister Rafidah Aziz said it was unlikely the US-Malaysia negotiations could be completed before the deadline, but Malaysia was willing to continue beyond that in any case. Negotiations have stumbled over thorny issues, such as proposed measures to give US firms access to government procurement and the service sector in Malaysia. In South Korea, the stumbling blocks are the required opening of Seoul's car, beef and pharmaceutical markets and how the US applies its anti-dumping rules.Kuala Lumpur-based economist Subramaniam Pillay says that the US labour federation has traditionally been concerned with protecting jobs, while the MTUC is more concerned about the erosion of workers' rights.
These were legitimate concerns for unions, he added. "Malaysian unions want to use this [joint declaration] as a leverage to strengthen workers' rights here. And the AFL-CIO may want to use it to protect workers from job losses in the United States."No more NaftasAmerican unionists argue they are not just concerned about job losses in the United States. "It is not just northern unions trying to take jobs from Malaysia," said AFL-CIO global economic specialist Jeff Vogt. "We want to make sure that trade between our two countries is equitable to our workers."Vogt argued that there was no need for US FTAs to demand intellectual property rights that went beyond the World Trade Organisation regime. Neither was there a need for FTAs to grant excessive rights to investors. Joining forces with developing countries' trade union movements to oppose FTAs "gives us more credibility in our advocacy in the United States [and allows us] to say, 'look, we are not being protectionist'," he added.
The Kuala Lumpur declaration states that it is clear that the US-Malaysia FTA will be based on "the same failed model as the North American Free Trade Agreement [Nafta]".Over the past 12 years, Nafta has facilitated corporate mobility and flexibility, but has arguably resulted in the loss of more than a million jobs and various other business opportunities in the United States. Critics say it has kept US wages low and undermined environmental and public health care protections. In Mexico, workers' real wages have remain flat or worsened, while inequality has widened, increasing the number of people in poverty, they contend.US trade unions and their Asian counterparts want trade agreements to include enforceable provisions to protect workers' rights, public services and the environment.
They complain that the Bush administration has not adequately addressed these concerns in the FTAs they have negotiated.In the Kuala Lumpur declaration, the unions noted there was evidence that the Malaysian government continues to oppose any labor protection in a potential FTA with the US, "based on a misguided notion that achieving economic growth and international competitiveness must be at the expense of core labour rights".Unionists point out that FTAs typically rely on weak national laws while provisions for enforcement of labor standards, dispute resolution and action against violators of workers' right are weak, ineffective and difficult.
In contrast, the FTAs tend to provide excessive protection for multinational corporate investment and profits, they contend.The MTUC and the AFL-CIO said they were also deeply concerned with the lack of transparency surrounding the negotiations and the government's failure to consult trade unions and civil society organizations in the process.Job security Malaysian unionists, meanwhile, are also worried about a recent public submission for the FTA negotiations made by the American Malaysian Chamber of Commerce and the US Chamber of Commerce.
The two bodies argued that "while it is important to protect the rights of workers, Malaysia's current employment laws are too restrictive and unbalanced against companies, thus making it very difficult for employers to terminate under-performing employees".The two bodies added that they would like to see Malaysia's domestic labour laws and its Industrial Relations Court reviewed, "to take into greater consideration the needs of employers and the ability of companies to remain competitive and productive through proper management of their workforces".Union critics see these comments as a thinly disguised desire to make it easier to lay off workers, as it is in the United States. Unionists are also deeply concerned that more secure jobs will, through the implementation of the FTA, be replaced with lower-paying part-time positions for which employers' are not required to pay benefits, such as health insurance.
"The most important area we [Malaysian unionists] are concerned about is security of tenure, the outsourcing of jobs and the sub-contracting of labor," said K Somasundram, an MTUC official who participated in the discussions with the AFL-CIO. "It is already happening in the banking sector, with the outsourcing of back-office services," he said. "Unions are concerned because they feel that this is one of the ways of busting unions as they will then be outside the scope of representation."In a statement in November, the executive council of the AFL-CIO proposed a new approach to make trade more fair and beneficial for all workers.
In particular, the group wants a slowdown in US President George W Bush's rush to negotiate new bilateral free trade agreements and a review of all current agreements - a wish they might get under a now Democrat-controlled Congress. The executive council is also calling for reform of the current trade regime to create a more just global economy, "one that works for working families and not just to boost the profits and power of multinational corporations".

EVENT : Fifth Round of Malaysia-US FTA in Feb 2007 in Malaysia
Online Publication Date: 15 February 2007The fifth round of the Malaysia-US FTA will be held in the week of 5 February 2007 in Karambunia, Sabah, Malaysia .

MEMORANDA / APPEAL LETTERS : The Coalition Against the Malaysia-US FTA’s Correspondence with the Government
Online Publication Date: 24 January 2007The Coalition Against the Malaysia-US FTA, a group of non-government organizations, political parties and civil society who are worried about the Malaysia-US Free Trade Agreement (FTA) negotiations, sent a memorandum to the Malaysian Minister of International Trade and Industry raising its concerns about the FTA. The Minister replied and made several promises. The Coalition then sent another memorandum highlighting issues that the Minister had not responded to. The full correspondence can be found at:1.
The Coalition’s first memorandum: http://www.ftamalaysia.org/article.php?aid=1282. The Minister’s reply: http://www.ftamalaysia.org/article.php?aid=1293. The Coalition’s second memorandum: http://www.ftamalaysia.org/article.php?aid=130 A summary of the correspondence is below.1. The Coalition’s first memorandum In October 2006, the Coalition wrote to the Minister, listing its concerns with the Malaysian Government’s decision to enter Malaysia-US FTA negotiations, which included: 1) That a detailed cost-benefit analysis has not been done for all sectors of the Malaysian economy and that analysis should be disclosed to the public.2) That the USFTA goes beyond trade - into services, investors’ rights, intellectual property and government procurement - and yet they are being held in secret.3) That Malaysia’s 296,000 rice farmers will suffer [if Malaysia’s tariffs on subsidized American rice are lowered]. 4) That medicines prices will rise because the patent period will be extended. 5) Problems of expropriation cases for example for chemical additives that are dangerous to health.2. The Minister’s replyWith respect to the points above, in a letter to the Coalition on 19 November 2006, the Minister asserted that: 1) ‘A cost-benefit analysis was done’ (however she did not release it to the Coalition or the public).2) (No response was made and the negotiations still have not been disclosed to the public).3) ‘The Government will not list rice and tobacco for market access by the United States’.4) ‘The Government will ensure that this Agreement will not threaten the ability of Malaysians to access cheap medicines’. 5) (No response).3. The Coalition’s second memorandum On 21 December 2006, the Coalition handed its response to the Minister’s reply, as well as handed the memorandum to the Prime Minister on 10 January 2007. In this memorandum, the Coalition’s main concerns with respect to the above included the following points:1) The cost-benefit analysis still needs to be made public.2) The minutes of the negotiations and the issues discussed still need to be made public.3) If it is true that rice and tobacco can be excluded from the FTA negotiations, what about the other farmers [such as pig farmers, cabbage farmers, chicken and egg farmers and dairy farmers who all currently benefit from tariff protection] who will also have to compete with US subsidized agricultural products when Malaysia’s tariffs on US farm products are reduced [to zero as USFTAs tend to require]? 4) The Coalition noted that all USFTAs except NAFTA have patent term extensions beyond the 20 years required by the WTO, and USFTAs also have a number of other intellectual property provisions [that are stronger than what the WTO requires], such as data exclusivity and linkage. The Coalition pointed out that these provisions have been predicted to significantly raise medicine prices and the full effect will not be felt for about 15 years after the USFTA is signed, according to the World Health Organization. The United Nations’ Special Rapporteur on the Right to Health, Ministers of Health and Trade, leading academics and non-governmental organizations have all expressed their concern at these provisions. 5) Its worries with respect to expropriation were not addressed by the Minister in her reply. The Coalition was also concerned that a USFTA may lead to industrial job losses in Malaysia if the US issues its usual demand to reduce all tariffs on its products to 0%. The American National Association of Manufacturers has estimated that it could double its exports to Malaysia in the first two years of an FTA. It was unlikely that Malaysia could compensate by exporting more to the USA under an FTA [as most US tariffs are low already] and the few tariffs that are still high (for example for textiles) cannot be reduced by more than 50% by the US Trade Representative under current US law. The Coalition also asked for a guarantee that the Malaysian government would only open to US companies those service sectors it lists (positive list) and expressed its skepticism based on UN and World Bank reports that a USFTA would increase foreign direct investment from the USA.