The Regional Comprehensive Economic Partnership (RCEP) is a coalition of 15 countries in the Asia-Pacific region with the intention to achieve trade liberty via proposed free trade agreements.
Initiated by the 10 ASEAN member states with their five dialogue partners – China, South Korea, Japan, New Zealand and Australia – the RCEP accounted for nearly one-third of the world’s population and around 30 per cent of the global GDP. India withdrew from the RCEP in November last year. Even without India, the participating countries have decided to sign the trade pact, which is expected to come into effect in 2021.
Obviously, the RCEP is an ideal circle of trade partners which would accelerate mutual trade growth and economic recovery, especially after global recession as a result of the Covid-19 pandemic.
Since its outbreak, both South Korea and Japan have encountered a drop in GDP and economic downturn, while ASEAN member states are looking for solutions to boost their markets and exports. Cross-border trade and cooperation are encouraged. The market within the RCEP circle is huge. The sizable population of Indonesia, China and Japan can create high demand in the consumer market. The RCEP circle can secure a steady demand and market for agricultural and perishable products in ASEAN, China and Australia. The logistic and economic activities will then resume gradually.
Again, we expect that the pandemic will last for a foreseeable period. The economy shall be restored simultaneously with the healthcare system. Lifestyle should resume to normal. Jobs must be secured. We consider China as one of the core engines in RCEP. In fact, China has demonstrated to the world that its supply chain is worthwhile and value-added. China’s supply chain hence creates values and opportunities to its Southeast Asian neighbours.
The Asia-Pacific region needs stability and growth. RCEP may set rules by implementing free trade agreements. Fair game and fair players would contribute to the importance of the RCEP loop. Ideally, the RCEP may welcome India’s re-entry and other new members’ admission. Another brilliant suggestion would be a potential fusion and integration between the RCEP and China’s Belt and Road Initiative. The collaboration would definitely lead to synergy.
The RCEP is an extension of ASEAN Plus Three. The maritime road connects trade from Australia to Southeast and Northeast Asia. Now, it is not an era for conflicts or confrontation. Fair and free trade guarantees a country’s economic growth. Let’s put aside all other irrelevant political agenda and just focus on the wellbeing of the people.
Chu Kar-kin is a PhD candidate and a veteran current affairs commentator based in Hong Kong.