A group of 15 countries from the Asia-Pacific region, including China, Japan, South Korea and Australia, have signed the world’s largest free trade agreement. The agreement, known as the Regional Comprehensive Economic Partnership (RCEP), covers more than two billion people and about a third of the world economy.
The agreement promoted by Beijing reduces tariffs and sets common trade rules. It covers trade, services, investment, telecommunications and copyright, the DPA agency wrote.
The agreement was signed on the sidelines of the Association of Southeast Asian Nations (ASEAN) summit in the Vietnamese capital Hanoi. According to economist Iris Pang from ING, it could help China reduce its dependence on overseas markets and technologies, Reuters reported.
“I am pleased to say that after eight years of hard work, we have officially completed the signing of the RCEP negotiations today,” Vietnamese Prime Minister Nguyen Xuan Phuc told Kyodo.
“The conclusion of the RCEP negotiations, the world’s largest free trade agreement, will strongly confirm ASEAN’s leading role in supporting the multilateral trading system. The region’s new trade structure will enable sustainable trade, revitalize supply chains disrupted by covid-19 and help economic recovery. after the pandemic, “added the Vietnamese prime minister.
Among other things, the reduction of already low tariffs, the strengthening of supply chains through shared rules and the introduction of new and shared rules for e-commerce should help the economy recover.
The agreement covers states with a population of 2.2 billion and a total gross domestic product of $ 26.2 trillion (585 trillion crowns), the Bloomberg agency wrote. It is broader than the Trans-Pacific Treaty of 11 countries, which US President Donald Trump resigned from in 2017. The world’s largest economy is thus not a member of either of the two main trading blocs of the world’s fastest growing region.
According to Reuters, the RCEP agreement can strengthen China’s position as a trading partner in Southeast Asia, Japan and South Korea. The world’s second economy could thus more easily shape the region’s trade rules.
It is a threat and an opportunity for the Czechia, experts say
“For Czech and other European companies, RCEP is both an opportunity and a threat. It can increase demand in the Member States for Czech subcontracting used for re-export in the form of the final product to countries that co-signed the agreement. “European companies have another reason to move production to Asia, because a huge duty – free market is being created there,” said Luděk Procházka, director of Gerlach, which is the largest Czech provider of customs services.
Miroslav Diro, a spokesman for the Czech Chamber of Commerce, reminded that one of the signatories to the agreement is Vietnam, with which the EU concluded an agreement on free trade and investment protection this year. “Not only Vietnam, but also other countries, such as South Korea, are thus a semi-open gateway for Czech companies to the entire region of 15 countries in the newly concluded agreement,” he said. “Only highly sophisticated, specialized and competitive Czech products will gradually be used on the market of this region,” he added.
“This is clearly bad news for the Czechia, but not necessarily from tomorrow. It will be more difficult to establish itself in the affected markets from year to year, because the local products will be easier to promote there,” said Capitalimed.com analyst Radim Dohnal.
The bloc, which has been negotiated since 2013, includes 10 ASEAN members (Brunei, Philippines, Indonesia, Cambodia, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam), along with China, South Korea, Japan, Australia and New Zealand. Zealand.
The RCEP must ratify another six ASEAN members and three other partner states for the association to come into force, said Singapore’s trade and industry minister. Singapore will approve the deal “within a few months,” he said.
India, which opposed last year’s ASEAN summit, is not a member of the newly formed economic entity. It claimed that its trade deficit with China would increase once the market was opened. However, the agreement contains a clause allowing Delhi to accede later.
– .
