Observers' views on RCEP

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The Guangxi Pingxiang Integrated Free Trade Zone in Guangxi Zhuang Autonomous Region in south China on April 13. The zone is a flagship project for facilitating economic interaction between China and ASEAN countries. [Photo/Xinhua]

The Regional Comprehensive Economic Partnership (RCEP) agreement was signed on November 15, marking a landmark achievement in East Asian regional integration. Scholars believe the pact will facilitate regional economic and trade cooperation, and inject new stability into an unstable world. Edited excerpts of their comments follow:

Song Qingrun, associate professor at the School of Asian Studies, Beijing Foreign Studies University

RCEP countries have a combined population of 2.27 billion or about 30 percent of the world's total. In comparison with the U.S.-Mexico-Canada Agreement (USMCA) and the EU, each of which covers around 500 million people, the RCEP offers more opportunities and greater market potential. Additionally, according to data from the International Monetary Fund, the total GDP of the 15 members reaches some $26 trillion, which is equivalent to or slightly higher than that of the three USMCA countries, and exceeds that of the EU.

The new deal is significant for its inclusivity and the diversity of its signatories. While the EU is composed of developed countries and the USMCA consists of two developed countries and one of the world's most advanced developing countries, the development disparity among the 15 RCEP countries is huge. But the agreement strikes a balance of interests between the developed and developing members in the areas of market access and regulation of goods, services and investment.

The signing of the RCEP shows that all members are committed to lowering tariffs, opening markets and reducing standard barriers, sending a strong message against unilateralism and protectionism. The joint leaders' statement on RCEP stated, "The signing of the RCEP agreement demonstrates our strong commitment to supporting economic recovery, inclusive development, job creation and strengthening regional supply chains as well as our support for an open, inclusive, rules-based trade and investment arrangement."

The RCEP is expected to boost regional development, enhance East Asia's status as an important engine of world economic growth, and contribute to global economic recovery in the post-pandemic era.

Li Dongxin, associate professor at Shandong University

The RCEP speaks volumes for the determination of countries to stick together and counter the anti-globalization tide. It represents the interests of developing members in global economic and trade governance, and is set to break the status quo of international economic and trade regulations established by developed countries, mainly in the pursuit of self-interest.

After the deal becomes effective, 90 percent of the goods traded between the 15 member countries will be tariff-free, though this number may not be the highest in comparison to other free trade agreements (FTAs). Moreover, the RCEP does not set strict conditions for participating countries regarding intellectual property, the labor market and environmental protection. This demonstrates how the quest for growth lies at the core of the interests of developing members.

The novel coronavirus disease (COVID-19) pandemic has taken a heavy toll on economies across the world. The signing of the RCEP will contribute to global economic recovery by providing a much-needed boost for the Asia-Pacific region and the world at large.

It also has implications for the cooperation among China, Japan and the Republic of Korea (ROK). The China-Japan-ROK FTA was first proposed in 2002. After 18 years of negotiations, the three countries have yet to conclude the process. The RCEP can add to their mutual political trust. Meanwhile, the partnership will further reduce trade barriers, laying solid foundations for the China-Japan-ROK FTA negotiations to move forward.

George N. Tzogopoulos, Director of the EU-China Program at the Centre International de Formation Européenne

China is largely seen as the main winner of the RCEP conclusion. Although the country will certainly benefit by the new partnership agreement, it is not looking for any type of victory in contrast to public perceptions. Its diplomacy, including its economic diplomacy, is calm and systematic, and counts on deeds rather than words. China does not act alone but in coordination with its trading partners.

The RCEP has been the result of difficult negotiations which began in 2012. Where China deserves special credit is its determination to act responsibly in the Asia-Pacific region. The country was active in the talks and finally reached common ground with the other 14 signatories. All of them seek to preserve free trade in order to strengthen their national economies.

A Vietnamese student (right) at Guangxi University of Foreign Languages participates in a live-streaming sales event in Nanning, Guangxi Zhuang Autonomous Region in south China, on August 25. [Photo/Xinhua]

The timing is also significant. The result of the U.S. presidential election did not generate second thoughts among some signatories. The world is progressing and is certainly different from what it was four years ago. Potential new initiatives by the U.S. will need to be carefully studied but the 15 RCEP signatories have already exhibited their interest in responding together to rising economic challenges in the Asia-Pacific region.

More importantly, the RCEP will connect 2.27 billion people, approximately 30 percent of the world's population and output. It will empower regional supply chains by offering a boost to local small and medium-sized enterprises (SMEs). In the meantime, the Belt and Road Initiative has the potential to unleash growth via investment, increasing the competitiveness of local SMEs.

In times of uncertainty, the RCEP conclusion sets a paradigm of confluence in international affairs. Its members cannot agree on all fronts. They are prepared to work together for the common good at the regional level, however.

For China, the RCEP functions not only as a practical outcome of commitment to multilateralism, it also sets the way forward for reaching similar agreements. In his 2020 China International Import Expo speech, President Xi Jinping talked about the acceleration of negotiations on a China-EU investment treaty and a China-Japan-ROK free trade deal.

Continuity and consistency matter in a world where predictability becomes a valuable, albeit rare, gift.

A train loaded with exports from Japan and the Republic of Korea sets off from Qingdao, a coastal city in Shandong Province in east China, for Almaty, Kazakhstan, on November 9. [Photo/Xinhua]

Ehizuelen Michael Mitchell Omoruyi, Executive Director of the Center for Nigerian Studies, Institute of African Studies, Zhejiang Normal University

The RCEP has created the first free trade area that brings together the three giant Asian economies of China, Japan and the ROK. The fact that Japan and the ROK are allies of the U.S. makes it quite interesting that these three nations have come together at a time U.S. President Donald Trump is moving in all directions to isolate China in the East Asian region.

There are three things worth looking at here. First, since the U.S. is presently focused on domestic concerns, including the necessity to combat the COVID-19 pandemic and rebuild its economy and infrastructure, the inclusion of Japan and the ROK reveals that the rest of the world will not wait around for the U.S.

Second, it sends a signal that RCEP nations have chosen the path of multilateralism over unilateralism and will open their markets instead of resorting to protectionist measures during this hard time.

Third, it also affirms the leading role of the Association of Southeast Asian Nations in supporting the multilateral trading system, creating a novel trading structure in the region, enabling sustainable trade facilitation, revitalizing the supply chains disrupted by the pandemic and providing a new impetus that will help the post-COVID-19 recovery globally.

The United States' unilateral trade policy under the Trump administration, combined with COVID-19, has brought Asia-Pacific economies closer. The RCEP reflects the necessity for regional countries to be of one accord. Guaranteeing stability in regional supply chains has also turned out to be much more imperative as the pandemic has wreaked havoc on global supply chains.

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