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It could help further strengthen China’s position in the region and is a direct competitor to the US attempt to strike a deal for the region, analysts say.
Fifteen countries in Southeast Asia and the Pacific region, including China, Australia and Japan, signed the RCEP on Sunday, which is known as the world’s largest free trade agreement.
– I’m very happy
The signatory countries are the ten members of the Organization of Southeast Asian Nations (ASEAN) – Vietnam, Thailand, the Philippines, Laos, Cambodia, Myanmar, Singapore, Indonesia and Brunei – as well as Australia, China, Japan, New Zealand and Korea. South.
Negotiations to get the deal have been going on for years.
– I am very pleased that, after eight years of sometimes difficult negotiations, today we are finalizing the negotiations on the RCEP and officially signing it during the 37th ASEAN meeting.Vietnam Prime Minister Nguyen Xuan Phuc said on Sunday.
2.2 billion people
The agreement will apply to 2.2 billion people and 29 percent of world economic activity.
From its entry into force, RCEP will mean reduced tariffs, the introduction of common trade rules and new supply chains. The agreement covers everything from commerce, services, investments, e-commerce, telecommunications and copyright.
Analysts say it is the largest trade deal in the world, in light of the countries’ gross national product (GDP).
The deal, which covers nearly a third of all economic activity on the planet, is seen as a great victory for China.
Great importance for China
Chinese Premier Li Keqiang hails the agreement as a victory for cooperation in the region.
– It is not only a milestone for regional cooperation in East Asia, it is also a victory for multilateralism and free trade.says Li, who, like other leaders, attended the summit by video.
China is expected to benefit greatly from the deal. According to the Peterson Institute for International Economics, China’s gross domestic product could rise by $ 85 billion.
Direct competitor from the United States
The United States does not participate in the free trade agreement, and is seen as a direct competitor of the Pacific TPP agreement, for which Barack Obama worked when he was president, but from which Donald Trump has removed the United States.
Obama saw the TPP as an important tool to reduce China’s dominance in the region, while the Chinese, for their part, have been working for the RCEP since 2012.
India pulled out of work last year, but several countries in the region say the door is wide open if India wants to join the deal.
Indonesian Commerce Minister Agus Suparmanto says the agreement will enter into force within two years, once member states ratify it.
