RCEP fuels new hopes for region's growth
January 10, 2022
Container ships are berthed along with the port at Singapore's Pasir Panjang Container Terminal on Aug 11, 2021. [Photo/Xinhua] As world's largest free trade deal now in force, analysts confident on gains The Regional Comprehensive Economic Partnership, which took effect on Saturday, will spur economic growth in the Asia-Pacific region as it opens up markets and counters protectionism, experts say. Consisting of 15 Asia-Pacific countries, the RCEP forms the world's largest free trade area. It is made up of the 10 members of the Association of Southeast Asian Nations, plus China, Japan, the Republic of Korea, Australia and New Zealand. Covering about 30 percent of the world's population, as well as its gross domestic product and trade volume, the agreement ushers in greater economic integration among Asia-Pacific countries and marks a victory for multilateralism and free trade, observers said. "It will play a role in creating some degree of confidence that trade integration-at least in moderate terms-will continue," said Manu Bhaskaran, chief executive of Centennial Asia Advisors, a think tank in Singapore. "In an age of growing protectionism and inward-looking policies, this is welcome." Francis Chua, founding chairman of the International Chamber of Commerce in the Philippines, said the RCEP is expected to consolidate the position of ASEAN members within a larger grouping built on "a modern, comprehensive, high-quality, and mutually beneficial economic partnership agreement". The regional bloc comprises Indonesia, Thailand, Singapore, Philippines, Malaysia, Vietnam, Brunei, Cambodia, Myanmar and Laos; some of the ASEAN members are yet to ratify the pact. In an online report, the ASEAN Secretariat said the entry into force of the RCEP "is a manifestation of the region's resolve to keep markets open; strengthen regional economic integration; support an open, free, fair, inclusive, and rules-based multilateral trading system; and, ultimately, contribute to global post-pandemic recovery efforts". "The ASEAN Secretariat remains committed to support the RCEP process in ensuring its effective and efficient implementation," the report says. Chua said the pact will ensure the opening of markets and strengthen supply chains and, this way, support an economic rebound. Apart from requiring the trade partners to cut tariffs, he said, the RCEP will enhance the harmonization of non-tariff measures such as product standards for food safety, packaging and labeling requirements. Sanjay Mathur, chief economist for Southeast Asia and India at ANZ Bank, cited China's huge economy and how it will serve as the "pivotal market" for all RCEP members. The pact's members "will now have (increased) access to the second-largest economy in the world, so that is a huge step forward", he said. Bhaskaran said that China, as a leading nation in Asia, can nudge the RCEP members to adopt "broader and deeper integration "in the region. At the same time, some analysts have pointed o...