On Sunday 15 November, fifteen Indo-Pacific countries signed the text of the Regional Comprehensive Economic Partnership (RCEP), which is set to become the world’s single largest regional trade agreement to date.
The parties to the RCEP include the members of the Association of Southeast Asian Nations (ASEAN) — Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam — as well as Australia, China, Japan, New Zealand and the Republic of Korea. In addition, a “Ministers’ Declaration on India’s Participation in the RCEP” provides for India’s accession to the agreement in the future, reflecting India’s participation in the RCEP negotiations while expressly “recognizing that India is not in a position to sign the RCEP Agreement in 2020”.
As it stands, the RCEP is estimated to cover a combined GDP of US $26.3 trillion and a total population of 2.3 billion people (see Government of Australia, “About The Regional Comprehensive Economic Partnership (RCEP)”). This coverage encompasses trade in goods and services, investment, government procurement, electronic commerce, intellectual property, and worker mobility. There are chapters addressing SPS measures, technical regulations, trade remedies, and competition, as well as chapters concerning small and medium-sized enterprises (SMEs), customs procedures and trade facilitation, and economic and technical cooperation. However, the RCEP is not as comprehensive in its coverage as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which also addresses a number of other subject matters.
There are five countries who are party to both the RECP and the CPTPP: Australia, Japan, New Zealand, Singapore, and Vietnam (Brunei and Malaysia are also signatories to both agreements, but have not yet ratified or implemented the CPTPP). It will be interesting to see how suppliers in these countries leverage the overlap between these agreements to enhance their market access advantages in each regional trade area.
Tereposky & DeRose regularly provides advice on the interpretation, application, and implementation of international trade agreements. Should you have any questions regarding the RCEP, the CPTPP, or any other trade matter, we are at your disposal.