15 nations complete ‘text-based’ negotiations for RCEP, signing expected in 2020

Asia
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BANGKOK: Fifteen out of 16 nations have concluded “text-based” negotiations for what could be the world’s largest trade deal, with formal signing now expected in 2020, said a joint statement by leaders issued on Monday (Nov 4).

“We noted 15 RCEP Participating Countries have concluded text-based negotiations for all 20 chapters and essentially all their market access issues; and tasked legal scrubbing by them to commence for signing in 2020,” said the joint leaders’ statement.

“India has significant outstanding issues, which remain unresolved. All RCEP Participating Countries will work together to resolve these outstanding issues in a mutually satisfactory way. India’s final decision will depend on satisfactory resolution of these issues,” the statement added.

This statement follows 28 rounds of negotiations and 18 ministerial meetings spanning about seven years.

The 16-nation RCEP accounts for a third of global gross domestic product and nearly half the world’s population.

RCEP includes the 10-member grouping of Southeast Asian nations, as well as China, South Korea, Japan, India, Australia and New Zealand.

New impetus to complete the deal has come from the US-China trade war, which has helped knock regional economic growth to its lowest in five years.

Speaking at the RCEP Summit, Prime Minister Lee Hsien Loong called the outcome a “very significant achievement”.

“Now, we are not quite across the finish line yet, but we are almost there,” he added. “Provided all goes well, we should be able to officially sign the RCEP Agreement next year in Vietnam.”

ASEAN has also played a “critical” role in the journey, added Mr Lee.

“ASEAN’s involvement as a trusted, neutral group, has enabled many countries to come together and cooperate under the umbrella of RCEP,” he said.

“This multilateral grouping has been a politically acceptable way for them to promote freer trade and closer interdependence. Without the RCEP, it would have been politically much harder for some of us to do bilateral or trilateral trade deals.

“And this is the value of ASEAN centrality that we put so much store on.”

When RCEP participating nations met this time last year, only seven chapter texts had been completed, Mr Lee pointed out.

And to advance negotiations, all the participating countries have had to make “difficult” trade-offs, he added.

“We have all had to make difficult trade-offs to advance the negotiations,” he said. ”Over the years, as we have negotiated, we have better understood one another’s concerns, and helped one another find constructive solutions.

“Now, together, we are making a significant step forward.”

Mr Lee also expressed his understanding for India’s position.

“Every FTA is a combination of economic logic and political considerations, which have to align for it to work,” he explained. “Singapore will work with fellow RCEP participating countries to resolve the outstanding issues that concern India.”

Mr Lee also called the RCEP a “major positive step” a a time when multilateralism is losing ground, and global growth is slowing.

“The diversity of the grouping demonstrates how economies at different stages of development can come together and contribute to each other’s development, as well as contributing to strengthening the multilateral trading system,” he added. 

“Because of this diversity, and because the participating countries have many links with the US, Europe and the rest of the world, the RCEP will be an inclusive and open group.”

In a Facebook post on Monday, Trade and Industry Minister Chan Chun Sing lauded the latest step in RCEP negotiations as a “significant milestone”.

“This journey is far from over” said Mr Chan. 

“Negotiations amongst such a diverse grouping of economies will always have its fair share of challenges. One can expect surprises, right down to the final moment. Hence, always amused to hear all the speculations and commentaries professing insider knowledge of the negotiations, prior to the final announcements, when the dynamics are so fluid,” he said.

READ: Asia-wide trade pact on course despite India, Thailand says

The 16-nation RCEP accounts for a third of global gross domestic product and nearly half the world’s population.

RCEP includes the 10-member grouping of Southeast Asian nations, as well as China, South Korea, Japan, India, Australia and New Zealand.

New impetus to complete the deal has come from the US-China trade war, which has helped knock regional economic growth to its lowest in five years.

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