ASEAN members reached common ground on the mega economic trade bloc, the Regional Comprehensive Economic Partnership (RCEP) during their meeting in Bangkok yesterday. RCEP will cover nearly half of the global economy.
The Regional Comprehensive Economic Partnership is a free trade agreement (FTA) between the ten member states of ASEAN – Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam – and the six Asia-Pacific states with which ASEAN has existing free trade agreements Australia, China, India, Japan, South Korea and New Zealand.
The next step is to negotiate the remaining 13 chapters of the trade deal together as a bloc at the upcoming senior economic officials’ meeting to be held in Melbourne, Australia between June 25 and July 3.
The mega-trade deal, which has been stuck in negotiations for the past seven years, has a total of 20 chapters, seven of which have now been completed.
In 2018, trade between the RCEP countries represented up to a third of global trade. Thailand’s trade value with the RCEP countries was worth some US$70 billion in 2018. Thailand’s exports to the RCEP countries currently accounts for nearly 60% of its total exports.
Thailand, as this year’s ASEAN chair, has set a bold target of completing the negotiations for this mega-trade pact by the end of 2019.
Negotiating with the remaining six members as a 10 country bloc will allow ASEAN to facilitate more progress in the negotiations process when the 16 RCEP countries meet.
Vietnam’s PM Nguyen Xuan Phuc, speaking to The Nation said, “In the context of increasing trade tensions and protectionism, promoting RCEP negotiations bear an important meaning as it strengthens rule-based multilateral economic connectivity and free trade throughout the Asia Pacific region.
The Vietnamese prime minister revealed that the 28th round of RCEP negotiations will be hosted by Vietnam in October, which will be the last round of negotiations this year ahead of the third RCEP Summit in Bangkok, which will be held in November.
“Vietnam hopes that for the spirit of broadening cooperation, ensuring equality and mutual interests, all sides will reach an agreement to finalise the RCEP negotiations as promised.”
The current challenge is that India and China, members of the trade bloc, have no free trade agreement to build upon, and have been holding up completion of some chapters to gain leverage in negotiations on other chapters. Hence, the remaining 13 chapters will be concluded together as they are interlinked with one another, according to a source familiar with the matter who asked to remain anonymous.
Source: The Nation