After nearly eight years of tiring negotiations, on 15 November China completed a far-reaching trade agreement involving 14 economies in Asia-Pacific. In addition to the ten ASEAN member states (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam) and New Zealand, the agreement includes Australia, Japan and South Korea. The Regional Comprehensive Economic Partnership (RCEP) is the first free trade agreement involving China, Japan and South Korea (three of the four major Asian economies) and is the first multilateral free-trade agreement to include the country of the Dragon. According to analysts, the agreement will help stimulate the economy during the COVID-19 pandemic by attracting the world’s economic centre of gravity towards Asia.
Initially also India should have participated in the RCEP, backing down last year probably worried about Chinese expansionism. Even without India, the numbers of the Partnership are still impressive. The region concerned, home to 2,7 billion people, produces nearly a third of global GDP. The agreement aims to progressively reduce duties and facilitate investments and exchanges between member countries (by creating common rules of origin). The result, some analysts explain, will be the strengthening of regional supply chains, under Chinese control. A commercial and political victory that China also collects against the United States.