ACCORDING to recent news reports, Malaysia is making efforts to woo more investments from the United States. Among these was Prime Minister Datuk Seri Najib Razak’s recent visit to New York.
As a relatively small, open economy, it can prove a delicate balance for a country like Malaysia to ensure it benefits from foreign investments without losing its rights to regulate foreign investors’ presence. This can become more delicate with a major partner country like the United States as we push ahead with negotiations under the Trans-Pacific Partnership (TPP) Agreement.
Agreements such as the TPP, while allowing for greater international trade and foreign investments, would also typically provide for certain exceptions to preserve the rights of countries. These include maintaining public order, regulating industries, and protecting human, animal or plant life or health.
What has become a particular flashpoint in on-going TPP negotiations is how to preserve countries’ rights to implement tobacco control measures. No prizes for guessing that the US tobacco industry would want fewer rights of countries to be provided for on this front.
Major medical and public health groups in the US and abroad have understandably reacted with grave concern. Indeed, they want more to be done in preserving tobacco control rights than in existing trade and investment agreements. They have thus strongly advocated for tobacco to be carved out completely from the TPP.
Meanwhile, Australia, a TPP country, is already in the thick of battle with the tobacco industry at its High Court, and under a bilateral investment treaty with Hong Kong.
The target of the industry’s ire? Australia’s new legislation on the use of plain packaging for cigarettes, which is due to be implemented by December.
Why should Malaysia pay close attention to these developments? Simply put, their outcome will chart the course of how Malaysia can manoeuvre tobacco controls in the future.
At its core, the real issue is about public health versus the tobacco industry. And it is very much related to Health Minister Datuk Seri Liow Tiong Lai’s recent warnings of “efforts by the tobacco industry to interfere with World Health Organisation’s Framework Convention on Tobacco Control”.
With a strong presence of foreign tobacco companies on our shores, it is only prudent that Malaysia keeps an ear to the ground while pressing on with our tobacco control measures.
As for the TPP, the US government is developing a draft proposal on tobacco that it says will “create a safe harbour for the (US) Food and Drug Administration tobacco regulation”. The question is: will it provide a “safe harbour” for Malaysia and other TPP countries to implement tobacco control measures within their jurisdictions, too?
The draft has not been released. But with the TPP being our first comprehensive trade and investment agreement with the US, Malaysia had best make sure that we plug any loopholes that might make it harder for us to crack down on tobacco at home.
Regardless of the TPP, the tobacco industry, unfortunately, cannot be prevented from challenging Malaysia through other international trade and investment agreements that we have signed.
Whether any such challenge has a legal basis or will even succeed does not matter. It could still serve as a delaying tactic and drain the government’s resources in defending the challenge.
What is vital, therefore, is that Malaysia holds the line, and not make it easier for foreign tobacco companies to challenge our measures through subsequent agreements like the TPP and others under negotiation. So, if Malaysia typically would not allow foreign tobacco companies to directly challenge us for damages — only allowing them to do so through their governments — I see no reason to budge from this position.
Ultimately, even as Malaysia courts trade and investments from abroad, responsibility to our people demands that this should not override the protection of public health. After all, tobacco may not be the end of the story.
There may yet be other public health challenges that we will need to deal with in the future. As much as possible, let us not allow our international trade and investment agreements to straitjacket us from doing just that.