Why it sucked
Economists, int’l media and our local media say
The TPP, which brings together 12 Asia-Pacific countries accounting for roughly 40 per cent of global GDP as signatories, is often hailed as a seminal trade framework that will enable exporters to benefit from the removal of duties on more types of goods than previous trade agreements provided for.
Well this letter made it to the Economist’s “best letters from our readers in 2016. Our letters editor picks submissions that sum up the year”. It tells us what conventional wisdom omits
Why they’re right
A lot of what you said in your leader on trade and globalisation made sense, but those who oppose trade deals are not “wrong” (“Why they’re wrong”, October 1st). Free-trade deals have changed remarkably since the repeal of the Corn Laws in the 1840s. Accords such as the Trans-Pacific Partnership, the Transatlantic Trade and Investment Partnership and the Comprehensive Economic and Trade Agreement are more about protecting the interests of large multinational corporations than they are about reducing costs for consumers and promoting competition.
These deals expand intellectual property rights, increase patent protections and enable foreign companies to sue governments for alleged losses of potential profits in supranational courts through “investor-state dispute settlements”. This is what the protesters are most opposed to: noxious provisions that boost the economic power of large corporations at the expense of democratic governments, smaller businesses and individual citizens.
Canadian Union of Public Employees
And there was this too:
Globalisation is inevitable, but the current configuration favouring neoliberal politics and economics is not. It is entirely possible to integrate domestic economies in ways that do not favour capital over labour or inequality over equality. More social democracy would address that.
The case for free trade has rested on a confusion between two notions of efficiency: Kaldor-Hicks and Pareto. Free-trade agreements are Kaldor-Hicks efficient because they produce overall net gains to welfare, but they are not Pareto efficient in that they do not make some better off without making some worse off. Economists and politicians have been too quick to point to the former type of efficiency but ignore or downplay the latter, thus producing a backlash.
Something is Kaldor-Hicks efficient not only if it actually maximises net wealth but also when losers are compensated for their losses. Somewhere along the line economists and politicians forgot this part of the equation.
PROFESSOR DAVID SCHULTZ
Journal of Public Affairs Education
St Paul, Minnesota
But why it matters to us
But for its faults, the anti-PAP cybernuts like the TRE ranters, Tan Jee Say, Goh Meng Seng, Philip Ang if they really care about their fellow S’poreans (which incidentally I don’t think they do. They are S’pore haters.) are wrong to cheer the defeat of an initiative where PM invested so much time, and effort.
As BT says
The setback for the TPP comes at a crucial time for Singapore, which is in the middle of drawing up a blueprint for its future economy – one in which internationalisation figures prominently, in order for its economy to grow externally.
And growing Singapore’s external pie has become increasingly crucial, given that its economy can expect a “new normal” of only 2-3 per cent annual growth, said Deputy Prime Minister Tharman Shanmugaratnam in September.
Although it is expected to boost Singapore’s gross domestic product (GDP) by only 2 per cent by 2025, the increased trade activity is expected to strengthen the city state’s role as a regional entrepot hub.
Forget the BS about “a blueprint for its future economy” (such a plan comes around once every decade) but we benefit from globalisation especially in trade and finance, both of which are slowing down.
Martin Wolf of the FT on the global trade slowdown
“Between 1960 and 2015, world trade increased at an average rate of 6.6 per cent, in real terms, while output grew at an average rate of 3.5 per cent. Between 2008 and 2015, however, average annual growth of world trade was 3.4 per cent in real terms, while world output grew at 2.4 per cent. Not only has the growth of trade slowed, but the gap between trade growth and that of output also fell sharply.”
And as PM said, S’pore would find it very difficult to get as advantageous terms, in bi-lateral deals. We are too small.
So even if PM is gross over-paid compared to Ah Beng, Mat, Gregoh or Ah Neh, let’s not diss him for trying to secure the TPP and failing. Juz KPKB that he should take a 90% pay cut but won’t for failing a KPI that is really impt for S’pore.