[ad_1]
On the 15th, attending the IV RCEP Summit …
文 “Restoration of global multilateralism, contributing to the development of free trade”
ASEAN to open additional parts … Green light for export of Hyundai Motors and parts companies
Reduce barriers to trade with Japan … Exclude concessions for sensitive items such as general managers
“The effect of the 0.51% increase in Korea’s GDP … also plays a role in preventing the expansion of protection trade.”
viewer
The ‘Regional Comprehensive Economic Partnership Agreement (RCEP)’, a multilateral free trade agreement (FTA) involving 10 Federations of Southeast Asian Nations (ASEAN and ASEAN) and 15 countries, including Korea, China, Japan, Australia and New Zealand, signed on the 15th. As a result, the world’s largest FTA market, set at 30% of the world’s gross domestic product (GDP) and population, opened eight years after the discussion began.
President Moon Jae-in said at the fourth RCEP video summit held at the Blue House on the same day that “the world’s largest FTA was signed in the face of the challenge of the crown, the expansion of the protection trade and the crisis. of a multilateral system “. President Moon continued: “I am confident that the RCEP will contribute to the restoration of multilateralism and the development of a free trade order in the world beyond the region.” President Moon’s comments are interpreted as seeking an economic path through multilateral trade amid increased uncertainty due to the new coronavirus infection (Corona 19) and the dispute between the United States and China.
The greatest expected effect of this agreement is to improve the competitiveness of national export companies by easing tariff rates. It is characterized by the fact that the tariff elimination rate is up to 10% higher than the Korea-ASEAN FTA by eliminating additional tariffs for each item. It is also expected that the administrative procedures of exporting companies will be simplified. Until now, exporting companies had to prepare source documents according to different NAFTA standards, but the administrative convenience of SMEs in particular is expected to increase as unified standards are applied. Comprehensive protection standards are also set for the intellectual property rights of Korean companies, such as copyrights, patents, trademarks, and designs.
It is also significant that it is the first FTA with Japan. As a result, Korea has signed an FTA with the world’s top five economies, including the United States, China, Japan, Germany, and India.
Concerned about the trade deficit with China, India was not present at the signing ceremony. However, member countries have decided to open the door to opportunities for India to participate in the RCEP in the future.
viewer
With the signing of the RCEP by the government, the level of tariff elimination with 10 ASEAN countries will increase by up to 94.5%. Consequently, Hyundai Motor Company and the auto parts industry faced an exciting period of market expansion. Furthermore, it is noteworthy whether this agreement marks the first FTA with Japan and will become a springboard to improve the stagnant bilateral relations. Amid the strong protective trade posture due to the Crown 19 incident after America’s ‘America First’, some say mega FTA in the Asia-Pacific region has established a barrier to free trade.
According to the Ministry of Commerce, Industry and Energy that day, the signing of RCEP will further open the market for ASEAN products. The tariff elimination rate for each country was raised to 91.9 ~ 94.5% by eliminating additional tariffs for each item than the Korea-ASEAN FTA tariff elimination rate (79.1 ~ 89.4% ) which came into effect in 2007. By item, Indonesia, the Philippines and Thailand have eliminated tariffs on auto parts such as seat belts, airbags and wheels. In Indonesia, tariffs of up to 40% have been imposed on auto parts, but they have been eliminated. If the duty on auto parts is removed while Hyundai is building a finished car plant in Indonesia, exports from domestic parts makers are expected to increase and improve local competitiveness. In some countries, tariffs on trucks and small cars have also been removed.
The RCEP also minimized the effect of the so-called “spaghetti ball” that occurs when bilateral free trade agreements are concluded unifying country of origin rules entered into individually with participating countries. The spaghetti ball effect is a situation where it is difficult for companies to receive the benefits of NAFTA due to different rules of origin and customs procedures, which differ from country to country, such as spaghetti tangled in a plate. For example, in the past, washing machine exports to China and Australia suffered from different standards of origin, but the conclusion of the RCEP resulted in a unified standard, increasing corporate convenience.
viewer
Additionally, even if materials are purchased and processed in all RCEP participating countries, cumulation of origin can be recognized. In the past, when Korea imported materials from China and exported them to Australia, only the Korean quantity was recognized as origin, but in the future, the Chinese quantity was also recognized as an accumulation of origin, so that companies could benefit from tariff reduction or elimination.
In addition, with the signing of the first FTA with Japan through RCEP, the trade barrier between the two countries was reduced. Recently, relations between Korea and Japan have been at the worst level in history, and there is an expectation that it could be a clue for improved relations and cooperation.
However, the economic effect is not expected to be significant in the short term. This is because the level of tariff elimination between Korea and Japan (83% based on the number of items) in this agreement is significantly lower than that of China, Australia, New Zealand (91-100%) and ASEAN. . A trade authority official said: “Through talks with the industry, major sensitive items such as finished vehicles and machinery were excluded from the opening.” It will go down. “
viewer
The improvement of the opaque business environment after Corona 19 through the signing of the RCEP is expected to have a positive effect on the domestic economic rebound. The Institute for Foreign Economic Policy (KIEP) predicts that even if India is absent, Korea’s real GDP will rise by 0.51% and consumer welfare will rise by around $ 5.47 billion, based on reduced tariffs. about goods. The effect on the Korean economy is expected to be even greater if additional trade liberalization is considered, such as the opening of the services market and the easing of non-tariff barriers through harmonization of rules of origin.
Another analysis suggests that attention should be paid to the effect of suppressing the trend of protectionism that is spreading throughout the world. While the US continues to prioritize its own policy, other countries suffering economic crises due to the Corona 19 outbreak are also taking steps to raise trade barriers. An Industry Ministry official said: “Even if the Joe Biden government enters the US, we will not immediately withdraw the protective trade policy.” “The RCEP will act as a barrier to prevent the flow of protection trade from spreading to Asia.” / Reporter Heo Se-min, Sejong = Kim Woo-ja [email protected]
< 저작권자 ⓒ 서울경제, 무단 전재 및 재배포 금지 >
