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The world’s largest free trade zone Photo: ©Kalyakan - stock.adobe.com
The Regional Comprehensive Economic Partnership (RCEP) by Hartmut Bühl, Publisher, Paris
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rade deals do not only have an economic impact. They also have a geopolitical aspect, cultural outcomes and often prepare a reordering of regional alignments, mostly creating All in all, the pact is a significant achievement between counstability. tries which are extremely diverse in nearly all areas, but they On 15th November 2020, the fifteen countries of the Regional were showing a high level of flexibility in the negotiations. An Comprehensive Economic Partnership (RCEP) held a solemn example is that tariff schedules extend to at least 20 years. virtual signing ceremony, creating the world’s largest free In another important area however, they stood shoulder to trade area stretching from the southern borders of Kazakhstan shoulder by agreeing on one single set of rules of origin for in the North to the South Pacific, including New Zealand. all goods. This is the first time that China has signed up to a Negotiations over the RCEP started in 2012 and were concludregional multilateral trade pact, having already some bilateral ed by the ten ASEAN countries1 as well as Australia, China, trade agreements in the region. And the RCEP is also the first Japan, New Zealand and South Korea. trade pact that includes China, Japan and South Korea. Members of the RCEP make up The main effect of this regional pact is to have wonearly a third of the world’s ven the various trade agreements of the Associapopulation and account South Korea tion of Southeast Asian Nations (ASEAN) with for nearly 30 % of GlobJapan China the five other countries of al Gross Domestic the Indo-Pacific region into a Product (GDP). Countries participating single framework. The deal excludes the Myanmar in the RCEP Vietnam The western world mostly United States because Laos Thailand sees the pact as an extenof its withdrawal from Philippines Cambodia sion of China’s influence in the region the Trans-Pacific PartnerMalaysia Brunei Singapore and likely to boost the total Gross ship (TPP) negotiations at the Indonesia Domestic Product (GDP) of RCEP initiative of the newly elected Member States. US President in 2017, expressing The European Union’s first his doubts on globalisation which might impression of the RCEP was not be advantageous to his country. The Australia expressed by the EU High Repremaining members went on multilaterally in form resentative/Vice President of of the Comprehensive and Progressive Agreement the Commission, Josep Borrell, for Trans-Pacific-Partnership (CPTPP)2. The RCEP also New Zealand who said: “The Indo-Pacific shows that globalisation is not dead and China’s graphic: ESDU, using Negoworks, region is of strategic imporPremier, Li Keqiang, praised the RCEP deal as “a victory of stock.adobe.com tance to us. We must enhance multilateralism and free trade”! our engagement to make sure our voice is heard and the India, also party to the negotiations, pulled out last year on overall structure of regional cooperation remains open and somewhat nationalistic decision, but the RCEP is keeping its rules based. ” door open for India, whereas it is closed for the US – at least for the time being.
First impressions of the RCEP There is no doubt that the RCEP will boost economic integration and influence member countries’ future trade policies. The Pact includes commitments in goods, services, investment, competition and last but not least, e-commerce. Standards, intellectual property rights and dispute settlement mechanisms have also been agreed.
1 The Association of Southeast Asian Nations ASEAN) was founded on 8th August 1967 and has actually 10 members: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam, and 2 Observers (Papua New Guinea and Timor Leste). Objectives: economic growth and to stimulate regional peace and stability based on the rule of law and the principle of United Nations. 2 The CPTPP is a trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, which entered in force on 30th December 2018. The treaty evolved from the Trans-Pacific-Partnership (TPP) which never entered in force because of the withdrawal of the US in 2017.
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