RCEP’s fruits come with challenge of keeping China in check

With the Regional Comprehensive Economic Partnership agreement taking effect Saturday, Japan and other member nations expect to revitalize the pandemic-hit economy through free trade in the economic bloc, regarded as the world’s largest, covering about a third of the global economy.

An outlook on its impact on Japan’s economy is particularly rosy, some analysis suggested. At the same time, however, Japan will face difficulties keeping China’s growing influence in the region in check, while its ally the United States remains at odds with China over human rights and other issues.

“Japan would benefit the most from RCEP tariff concessions, largely because of trade diversion effects,” a recent report published by the UN Conference on Trade and Development pointed out.

The 15-member RCEP was signed on Nov. 15, 2020, coming into force following ratification by at least six member states of the Association of Southeast Asian Nations and three non-ASEAN economies.

It incorporates Japan’s first economic partnership agreement with China and South Korea, the two main destinations of its exports in Asia.

RCEP, seen as turning the region into “a new center of gravity for global trade,” is expected to ultimately eliminate tariffs on over 90 percent of goods traded within the bloc comprised of economies of various sizes and at different stages of development.

RCEP consists of ASEAN — Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam — plus Australia, China, Japan, New Zealand and South Korea, which also account for around 30 percent of the global population.

SOURCE: NEWS AGENCIES