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US supports TPP bid

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Khmer Times | 10 June 2016

US supports TPP bid

by Chea Vannak

The United States yesterday threw its support behind Cambodia becoming a member of the US-led Trans-Pacific Partnership (TPP) to promote economic growth, trade and investment in the Asia-Pacific region and the Pacific Rim countries.

The Under Secretary of State for Economic Growth, Energy and the Environment, Catherine Novelli, in her visit to Phnom Penh yesterday said that the United States was happy to work with Cambodia on its intention to join the TPP.

“Cambodia has an open trade policy and I think it’s much easier for it to agree to the terms of the TPP that are already in the agreement,” she told journalists.

The TPP is a trade agreement among 12 Pacific Rim countries signed this February in New Zealand, after seven years of negotiations. Implementing the TPP is one of the goals of US President Barrack Obama before he leaves office at the end of the year.

Prime Minister Hun Sen in his visit to Washington in February met with President Obama to discuss the TPP.

Ms. Novelli said Cambodia now had to demonstrate its willingness to take the negotiations to a higher level to join the TPP.

One of the prerequisites for Cambodia to join the TPP is that it must first have a bilateral investment agreement with the United States. Cambodia and the United States began exploratory discussions for a potential bilateral investment treaty in 2012.

“We are happy to work with Cambodia to explain all provisions of it [TPP],” said Ms. Novelli.

“One of the reasons why we’ve been so interested in proceeding with the bilateral treaty is that there are similar provisions for it, in terms of investment, in the TPP,” she said. “Cambodia, now, is in a very good position to take it [bilateral investment treaty] forward.”

Ms. Novelli said the United States was happy to negotiate with Cambodia on the TPP as soon as the country was ready, first, for the bilateral investment treaty. She said a joint US-Cambodia committee had just been formed to study provisions in the bilateral treaty.

“What’s clear to me is that there is a timetable for the complete study,” she added.

Chheang Vannarith, a lecturer of Asia Pacific politics at the University of Leeds in the UK, told Khmer Times that joining the TPP will benefit the Kingdom.

“The TPP is the gold standard for free trade agreements,” he said. “As a small country and small economy, trade openness is critical to Cambodia.”

“Cambodia needs to study the TPP carefully to identify opportunities and challenges,” Mr. Vannarith said, adding that the country needs to accelerate institutional reforms and increase its capacity for export in order to benefit from the TPP.

Ear Sophal, associate professor of diplomacy and world affairs at Occidental College in Los Angeles, said the TPP might help reduce corruption in Cambodia because it allows corporations to sue the government for violations of the partnership agreement outside of the Cambodian legal system.

“If it’s in Cambodia’s courts, forget it. The authorities will always win,” he added.

David Van, a senior adviser at the Bower Group Asia business consultancy, told Khmer Times that bilateral investment treaties are to protect investor rights and to encourage the adoption of market-oriented domestic policies that treat private investment in an open, transparent and non-discriminatory way.

To date, 41 countries have signed bilateral investment treaties with the US with another seven pending ratification from their parliaments. But there are also 14 countries that do not have a bilateral investment agreement but a free trade agreement with the US with about another 17 in the negotiation process.

 source: Khmer Times