Rcep Agreement Benefits

The agreement will enter into force after the ratification of six Asean countries and three non-Asean countries. Our economic relations with Southeast Asia are strong. For many years, the EU has been the main source of foreign direct investment in ASEAN and one of its main trading partners. We have already concluded important free trade agreements with Singapore and Vietnam, as well as with Japan and Korea, and we are negotiating with several other countries, including Indonesia, Australia and New Zealand. These agreements have helped to maintain trade despite the pandemic, for example by significantly increasing imports of organic chemicals and essential medicines from Singapore. But it may be some time before any country sees the benefits, because six Asean nations and three other nations must ratify them before they become effective. Mr. Marro thinks it could be a slow process. Many years ago, in February 2015, when the Trans-Pacific Partnership was signed, President Obama said that agreements like this allow us to “write the rules of the road in the 21st century.” But history took another turn when President Trump withdrew from the TPP in his first days in office (which eventually advanced without the United States and became the CPTPP).

Some Europeans may be wondering if we have missed it. Is the European Union weaker because 15 other countries have signed a free trade agreement without us? The answer is no. Just as we believe in free and fair trade and multilateralism to achieve this, we can be pleased if others follow this path to increase their own prosperity. And thanks to the growth of the global economy, the RCEP will help create more – not less – business opportunities with the region, just as our own single market offers them opportunities. As an EU, we tend to have more ambitious free trade agreements with almost all countries in the RCEP agreement. The RCEP may enter into force after ratification of the agreement by at least six ASEAN countries and three non-ASEAN countries. This is expected to take some time, but the tone of future trade with ASEAN remains. The RCEP will continue to build on previous ASEAN trade agreements, but will also include major agreements with other countries such as Japan and South Korea. In this context, trade within ASEAN can be negligible. The RCEP agreement is proof that ASEAN has managed to place itself at the centre of its region, even as the major powers tend to lose their weight. ASEAN has also developed an “Indo-Pacific space perspective” which, in a context of growing security and political tensions, underlines the need to keep the area open, stable, inclusive and subject to rules.

It is clear that the Indo-Pacific area will be the most dynamic region in the world and the centre of growth for decades to come. The region`s success in managing the COVID 19 pandemic, certainly in relation to Europe and the United States, has further reinforced this trend. Multilateral agreements such as the RCEP are welcome, but they cannot replace an effective multilateral trading system that still needs to be urgently revived. The RCEP and other bilateral and multilateral agreements have multiplied over the past two decades, given the lack of progress in the multilateral trading system in promoting global trade integration. However, such agreements cannot replace multilateralism. This is particularly true for developing countries, which have benefited greatly from the rules-based trading system through safeguards against trade discrimination, incentives for reform and market access around the world. An effective multilateral trading system remains the best way to resolve damaging trade disputes, such as those that continue between the United States and China, and to avoid future disputes.

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