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The Department of Commerce and Industry (DTI) expects policy makers to ratify the Regional Comprehensive Economic Partnership (RCEP) within 2021 in support of the country’s economic recovery from the unprecedented damage caused by the Covid-19 pandemic.
In an interview with reporters, Undersecretary of Commerce Allan B. Gepty said the DTI awaits ratification of the RCEP and Senate approval by next year. The RCEP is a multilateral trade agreement concluded in November involving the 10 Southeast Asian nations and trading partners Australia, China, Japan, New Zealand, and South Korea.
As with any free trade agreement (FTA), the RCEP must be ratified by President Duterte and must be approved by the Senate before it goes into effect at the national level.
Next year would be the ideal time to ratify the RCEP, Gepty said, as exporters can use it to boost their activities in line with the national recovery from the health crisis. Furthermore, he said that the RCEP as a whole can only be legally enforced by 2021 because of a clause that states that the trade agreement can only go into effect once it is ratified by a majority of the signatories.
“The effectiveness of the RCEP agreement depends on the signatories. It will only enter into force when there are at least six ASEAN member states and three trading partners that have deposited their approval, ”Gepty explained.
In an earlier statement, Commerce Secretary Ramón M. López himself said that he believes lawmakers will ratify the RCEP without delay, as the trade agreement could be key to reducing the cost of Covid-19 vaccines and facilitating their transfer. to the Philippines.
López explained that the Philippines can maximize its membership in the RCEP to reduce the cost of vaccines manufactured by the parties to the trade agreement, particularly China. He said rates for medical supplies are cut, if not eliminated, under the RCEP, as agreed by negotiators, in light of the health crisis.
In November, the state leaders of the Southeast Asian nations, along with Australia, China, Japan, New Zealand and South Korea, signed the trade agreement that was negotiated for nearly a decade.
The RCEP is one of the largest economic agreements in the world, covering at least 25 chapters on multilateral relations between its parties. It establishes rules and regulations on the trade of goods, services, investments, electronic commerce, dispute resolution, rules of origin, among others, with the aim of opening up the economies of the RCEP countries.
RCEP’s 15 negotiators account for about 29 percent of global GDP, but it used to be 32 percent when India was part of the negotiations. Last year, India withdrew from the RCEP talks for hesitating to lower its tariff rates as required by the trade deal.
