World's largest free trade deal takes effect on first day of 2022
KEY POINTS
- The RCEP agreement can significantly lower the cost of trade in the region
- The RCEP enables China and Japan to build a direct free trade partnership
- By 2030, it will increase members' incomes by 0.6 percent, adding $245 billion
The Regional Comprehensive Economic Partnership (RCEP) agreement, the world's largest free trade agreement, entered into force on Saturday January 1, 2022.
Article continues below
Topics: ASIA CHINA JAPAN KOREA AUSTRALIA NEW ZEALAND
Covering nearly a third of the world's population and accounting for about 30 percent of the world GDP, the new free trade bloc aims to facilitate trade
The RCEP was signed on November 15, 2020 by 15 Asia-Pacific countries - 10 members of the Association of Southeast Asian Nations (ASEAN) and China, Japan, the Republic of Korea, Australia and New Zealand - after eight years of negotiations that started in 2012.
The deal came into force initially in 10 countries that have submitted instruments of ratification with the ASEAN Secretariat.
Covering nearly a third of the world's population and accounting for about 30 percent of the world GDP, the new free trade bloc aims to facilitate trade and investment in the Asia-Pacific region, and boost economic globalization.
The RCEP enables China and Japan to build a direct free trade partnership with tariffs on 86 percent of products from Japan and 88 percent of products from China eventually down to zero.
The RCEP agreement can significantly lower the cost of trade in the region, enhance the competitiveness of products, create more business opportunities for enterprises, and provide more choices and benefits to consumers, he said.
A study from the Asian Development Bank predicted that the RCEP will significantly contribute to post-pandemic economic recovery in the Asia-Pacific region and worldwide. ■