15 countries have joined hands together to form the world’s largest trading bloc to cover nearly a third of global economy. RCEP: The Regional Comprehensive Economic Partnership consists 10 Southeast Asian countries as well as South Korea, Japan, China, New Zealand and Australia. The trade block is seen as explanation of Chinese influence in the region.
The pact excludes the United States which pulled off from a rival Asia-Pacific trade pact in 2017. President Trump retracted from the TPP: Trans-Pacific Partnership after assuming the White House. The deal included 12 countries and was backed by Republican’s predecessor Barack Obama as a way to challenge Chinese potential monopoly in the region but eventually fell through because of Trump’s inward policy.
The talks and paperwork over the RCEP began in 2012 and the deal was eventually inked on Sunday on the sidelines of a meeting of the Association of Southeast Asian Nations (ASEAN), hosted by Vietnam.
“I am delighted to say that after eight years of hard work, as of today, we have officially brought RCEP negotiations to a conclusion for signing,” said Vietnam’s Prime Minister Nguyen Xuan Phuc.
Officials were seen signing the copies of the agreement and showing them off on camera at a virtual summit in the wake of COVID-19 pandemic. The signatories hope that the pact will help to speed up the recovery from the coronavirus pandemic.
“Under the current global circumstances, the fact the RCEP has been signed after eight years of negotiations brings a ray of light and hope amid the clouds,” said Chinese Premier Li Keqiang. He praised the deal as a “a victory of multilateralism and free trade”. India was also part of the initial negotiations but opted out of the agreement over the fears that that lower tariffs would put a dent in local production. However, signatories of the agreement said the door is still open for India to share the future.
RCEP member states make up nearly a 3rd of global population and account for 29% of global gross domestic product. The new free trade alliance widely dubbed as a future of trade in Asia is bigger than US-Mexico-Canada deal and EU bloc.