[ad_1]
CANBERRA: Fifteen Asian-Pacific nations are set to sign a huge free trade agreement at an online summit that began Thursday, and the pact is seen as a blow for China to extend its influence in the region.
Once signed, the Regional Comprehensive Economic Association (RCEP) will be the world’s largest trade pact in terms of GDP, according to analysts.
The pact, which was first proposed in 2012 and seen as a China-led rival to a now-defunct American trade initiative, applies to 10 Southeast Asian economies alongside China, Japan, South Korea, New Zealand and Australia. .
“After eight years of negotiating with blood, sweat and tears, we finally reached the point where we will seal the RCEP Agreement this Sunday,” Malaysian Trade Minister Mohamed Azmin Ali said before the virtual meeting.
Vietnam’s Prime Minister Nguyen Xuan Phuc also confirmed that the pact would be signed this week during opening remarks at the online summit.
India was supposed to sign the pact, but withdrew last year over concerns about cheap Chinese goods entering the country, though it may join at a later date if it reverses its position.
The RCEP, whose members represent about 30 percent of global GDP, would be a “big positive step for trade and investment liberalization” in the region, said Rajiv Biswas, chief economist for Asia Pacific at global business consultancy IHS. Markit.
“RCEP will be the largest free trade zone in the world measured in terms of GDP,” he told Agence France-Presse.
The long-awaited signing of the pact comes as the 10-member Association of Southeast Asian Nations (ASEAN) struggle to mitigate the crippling cost of the coronavirus, which has devastated their economies and left many battling a serious public health crisis.
The pact is also seen as a mechanism for China to draft the rules of Asia-Pacific trade, following years of US withdrawal under President Donald Trump.
“It certainly gives an edge to China’s geopolitical ambitions,” said Alexander Capri, a trade expert at the National University of Singapore Business School.
But US President-elect Joe Biden can interact more actively with the region, Capri added, in the same way that former President Barack Obama did.
“Think of the Biden administration as a kind of continuation of the Obama administration, certainly when it comes to the turn to Asia,” he said. As the region waits to see how its relationship with the United States will develop, it is grappling with several other thorny issues, including disputes over the South China Sea.
Flash point waters, claimed in full by Beijing but also contested by Vietnam, the Philippines, Malaysia, Brunei and Taiwan, will also be on the summit’s agenda.
But as several nations battle severe outbreaks of Covid-19, and with many promises of priority access to vaccines made in China, a position against Beijing is seen as unlikely.
[ad_2]
