It was a momentous day as Leaders of Association Southeast Asian Nations (ASEAN), Australia, China, Japan, Republic of Korea and New Zealand witnessed the signing of the Regional Comprehensive Economic Partnership (RCEP) Agreement on Sunday (11/15) - Photo by ASEAN Secretariat Office

JAKARTA (TheInsiderStories) – It was a momentous day as Leaders of Association Southeast Asian Nations (ASEAN), Australia, China, Japan, Republic of Korea and New Zealand witnessed the signing of the Regional Comprehensive Economic Partnership (RCEP) Agreement on Sunday (11/15). But, some observers sees the agreement benefits China more and is a warning to the United States

The RCEP also marked ASEAN’ biggest free trade pact to date, covering a market of 2.2 billion people with a combined size of US$26.2 trillion or 30 percent of the world’ GDP. It will eliminate as much as 90 percent of the tariffs on imports between its parties within 20 years of coming into effect, and will improve market access for goods and services within the region.

“The signing of the RCEP Agreement is a historic event as it underpins ASEAN’ role in leading a multilateral trade agreement of this magnitude, despite global and regional challenges and eight years of negotiations. RCEP will give a much-needed boost for a swift and robust recovery for businesses and peoples in our region particularly during the current COVID-19 pandemic crisis,” said Dato Lim Jock Hoi, Secretary-General of ASEAN in an official statement.

The deal, he continued, will improve market access with tariffs and quotas eliminated in over 65 percent of goods traded and make business predictable with common rules of origin and transparent regulations, upon entry into force. This will encourage firms to invest more in the region, including building supply chains and services, and to generate jobs.

The agreement will updates the coverage of the existing ASEAN Plus One Free Trade Agreements (FTAs) and takes into consideration changing and emerging trade realities, including the age of electronic commerce, the potential of micro, small and medium enterprises, the deepening regional value chain, and the complexity of market competition.

The RCEP also will complement the World Trade Organization, building on the its Agreement in areas where the parties have agreed to update or go beyond its provisions. Comprehensive. The agreement is comprehensive, in terms of both coverage and depth of commitments.

He adds, the pact is designed to achieve this objective in a number of ways, including through appropriate forms of flexibility and provisions for special and differential treatment especially for Cambodia, Lao PDR, Myanmar, and Viet Nam, as appropriate, and additional flexibility for the least developed parties. 

In addion, said Hoi, the agreement is open for accession by any countries or separate customs territory 18 months after its entry into force, although this agreement is open for accession by India, as an original negotiating state, from the date of its entry into force, without waiting for 18 months.

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