Today (15th), Vice Minister of Commerce and Deputy International Trade Representative Wang Shouwen accepted a collective interview with reporters on the official signing of the Regional Comprehensive Economic Partnership Agreement (RCEP) and the characteristics, significance, and implementation of RCEP.
Wang Shouwen introduced that on November 15, 2020, the Fourth Leaders’ Meeting of the Regional Comprehensive Economic Partnership (RCEP) was held via video. Chinese Premier Li Keqiang attended the meeting. At the meeting, 15 trade ministers signed the RCEP agreement under the witness of leaders of 15 countries. Minister of Commerce Zhong Shan signed the agreement on behalf of the Chinese government. This marks the official start of the free trade zone with the largest population, the largest economic and trade scale, and the most potential for development in the world.
RCEP was initiated by ASEAN in 2012. After 8 years of negotiations, especially since this year, RCEP members have overcome the difficulties caused by Coronavirus pandemic, fully completed market access negotiations, and completed the review of the 14,000-page legal text of the agreement. Finally, today During the leaders’ meeting, the agreement was signed as scheduled. This is the most important achievement in the construction of East Asian economic integration in the past 20 years.
What are the characteristics of RCEP?
Wang Shouwen said that on the whole, RCEP is not only the world’s largest free trade agreement, but also a comprehensive, modern, high-quality and mutually beneficial free trade agreement. in particular:
RCEP is a comprehensive agreement. It covers 20 chapters, including market access for goods trade, service trade, investment, etc., as well as a large number of regulations such as trade facilitation, intellectual property rights, e-commerce, competition policy, and government procurement. It can be said that the agreement covers all aspects of trade and investment liberalization and facilitation.
RCEP is a modernization agreement. It adopts regional origin accumulation rules to support the development of regional industrial chain supply chains; adopts new technologies to promote customs facilitation and promotes the development of new cross-border logistics; adopts a negative list to make investment access commitments, which greatly enhances the transparency of investment policies; the agreement also includes The chapters on high-level intellectual property and e-commerce have been introduced to meet the needs of the digital economy era.
RCEP is a high-quality agreement. The total number of zero-tariff products in trade in goods exceeds 90%. The level of service trade and investment liberalization is significantly higher than the original “10+1” free trade agreement. At the same time, RCEP has added a free trade relationship between China, Japan and Japan and South Korea, which has significantly increased the degree of free trade in the region. According to calculations by international think tanks, in 2025, RCEP is expected to drive member countries’ export growth 10.4% higher than the baseline.
RCEP is a mutually beneficial agreement. RCEP members include developed countries, developing countries, and some least developed countries. The economic systems, development levels, and scales of RCEP vary greatly among members. The RCEP agreement takes into account the demands of all parties to the greatest extent, and achieves a balance of interests in the areas of market access and regulations such as goods, services and investment. The agreement also gives differential treatment to the least developed countries, and specifically sets two chapters on SMEs and economic and technical cooperation to help developing members strengthen capacity building, promote inclusive and balanced development in the region, and share the results of RCEP.
What is the significance of RCEP signing?
Wang Shouwen said that the signing of the RCEP agreement is a new milestone in East Asian regional economic integration. The total population, economic volume, and total trade volume of the 15 member states of RCEP account for about 30% of the global total, which means that about one-third of the world’s economies form an integrated market. This will greatly boost regional trade and investment confidence, strengthen the industrial chain and supply chain, enhance the ability of all parties to cooperate in the fight against the epidemic, boost the economic recovery of all countries, and promote the long-term prosperity and development of the region. At the same time, RCEP will also provide a path and a strong impetus for the FTAAP process.
RCEP supports the liberalization and facilitation of trade and investment with practical actions, which will boost the confidence of the global economy. The signing of RCEP shows that all members are committed to reducing tariffs, opening markets, and reducing standard barriers. It sends a strong signal against unilateralism and protectionism, strongly supports free trade and the multilateral trading system, and contributes to the formation of a positive effect on the global economy. It is expected to stimulate the global economic recovery after the epidemic.
RCEP will help my country accelerate the formation of a new development pattern. RCEP members are my country’s important economic and trade partners. From January to September 2020, China’s total trade with other RCEP members reached US$1,055 billion, accounting for about one-third of China’s total foreign trade. In particular, through the newly established China-Japan free trade relationship through RCEP, my country’s trade coverage with free trade partners will increase from the current 27% to 35%. The achievement of RCEP will help expand China’s export market space, meet the needs of domestic import consumption, strengthen the supply chain of the regional industrial chain, and help stabilize foreign trade and foreign investment. It will help to form a domestic and international double cycle that promotes each other. The new development pattern provides effective support.
When will RCEP take effect?
According to Wang Shouwen, according to the RCEP, at least 9 of the 15 members must approve the agreement to enter into force, including at least 6 ASEAN member states and at least 3 of China, Japan, South Korea, Australia and New Zealand. Now that the agreement has been signed, the members of RCEP will perform their own domestic legal approval procedures and strive to promote the early implementation of the agreement. The leaders have instructed the ministers to expedite the domestic approval process. China will also work with all parties to make the RCEP agreement benefit businesses and people in the region as soon as possible.