Talks on a China-backed free-trade pact have reached a “critical stage,” Singaporean Prime Minister Lee Hsien Loong (李顯龍) said yesterday, as he urged regional economic ministers to seal the deal by the end of the year.
The 16-nation Regional Comprehensive Economic Partnership (RCEP), which would be the world’s biggest free-trade accord if it is agreed, has taken center stage as Washington embarks on a unilateral protectionist agenda.
Covering about half the world’s population, the RCEP excludes the US, which had been leading another regional pact — the Trans-Pacific Partnership (TPP) — until US President Donald Trump abandoned it early last year.
“The RCEP negotiations have continued for some time and have now reached a critical stage,” Lee said as he opened a five-day meeting of ASEAN economy ministers.
The Singapore meeting is to be joined later in the week by top trade officials from ASEAN’s main trading partners, including China, Japan, Australia and the US.
“After a great deal of work, the possibility of substantively concluding the RCEP negotiations is finally in sight,” he said.
Lee also warned about escalating tensions between the US and China — who have been locked in a trade row — and other major economies, including the eurozone and Canada.
“The RCEP will be an important signal to the world that ASEAN members and our partners place high value on free trade, regional integration and international cooperation,” he said.
The accord would group the 10 ASEAN members, plus China, India, Japan, South Korea, Australia and New Zealand, and would cover one-third of the world’s GDP.
Singapore, this year’s ASEAN chair, is pushing for an agreement on the RCEP before handing over the chairmanship to Thailand next year, a diplomatic source said.
Another source involved in the talks said that ASEAN leaders hope to announce the “substantial conclusion” of negotiations during a summit in November with their main trading partners, and they expect the pact to be implemented in 2020.
Beijing is keen to use Washington’s rejection of the TPP to build enthusiasm for its own deal and increase influence in the region.
The RCEP is a more modest deal that prescribes lower and more limited regulatory standards.
The 11 remaining TPP members signed a slimmed-down version of the agreement in March.
Meanwhile, Indonesian President Joko Widodo and Australian Prime Minister Scott Morrison hope to announce the completion of negotiations on an economic partnership pact between the two nations tomorrow, Indonesian Director for East Asia and the Pacific Edi Yusuf said.
The director told a briefing ahead of a visit by Morrison to Indonesia this week that negotiations were still continuing on the Indonesia Australia Comprehensive Economic Partnership Agreement.
The deal is set to be signed later this year and should include the opening-up of investment in Indonesia’s university sector by Australia, he said.
Additional reporting by Reuters
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