Asia-Pacific nations, including China, Japan and South Korea, signed the world’s largest trade deal on Sunday, in areas that account for a third of the world’s population and global GDP, according to Bloomberg. Mediafax.
Leaders of 15 nations, including Australia and New Zealand, as well as ten member states of the Association of Southeast Asian Nations have signed the Comprehensive Regional Economic Partnership (RCEP). The agreement was signed on the last day of the summit of the Association of Southeast Asian Nations (ASEAN), organized by videoconference from Vietnam.
“Completing the negotiations is a strong message to affirm ASEAN’s role in supporting the multilateral trading system,” Vietnamese Prime Minister Nguyen Xuan Phuc said. “The deal will help develop supply chains disrupted by pandemics and spur economic recovery,” said Nguyen Xuan Phuc.
To enter into force, the RCEP agreement will need to be ratified by at least six states of the Association of Southeast Asian Nations (ASEAN) and three partners outside the organization, Singapore Commerce Minister Chan Chun Sing said. The Singapore government intends to formally approve the deal “in the coming months,” he said.
Proponents of the RCEP agreement, which will cover an area with a population of 2.2 billion people and a total GDP of $ 26.2 trillion (€ 22.1 trillion), say the treaty will stimulate economic recovery by reducing tariffs, strengthening supply networks and standardizing new regulations in online commerce.
India withdrew from negotiations on this trade deal last year. Prime Minister Narendra Modi said the RCEP agreement will affect the standard of living of Indian citizens, mainly the most vulnerable. India may later join this agreement.
Some experts believe that the RCEP agreement will change the regional dynamic in China’s favor, but this will depend on the approach of the future US administration, President Joseph Biden. The RCEP agreement highlights how incumbent President Donald Trump’s decision to withdraw from the Trans-Pacific Partnership (TPP) negotiations has affected Washington’s ability to counter China’s regional influence.