I've just been told this is for TPS.
The TPS provides input to retard the ignition when the throttle is opened, to prevent pinging. It allows the engine to run with advanced timing when the throttle is closed, improving efficiency.
I've never heard of TPS and it doesn't seem to be fitted to most Kymco 125s - does this mean I have the wrong carb or can I fit the new carb without connecting the TPS