Signs are already emerging that the Regional Comprehensive Economic Partnership, or RCEP, could expand beyond the one-third of the world it already covers.

Allan Gepty, assistant secretary for international trade policy and trade negotiation at the Philippines Department of Trade and Industry, who was the country’s lead RCEP negotiator, said eliminating tariffs means “people can have cheaper access to raw materials and intermediate goods necessary for production and manufacturing activities”.

The partnership, covering 15 countries that are home to about one-third of the world’s population and some 30% of global gross domestic product, could grow in size over the next few years. The trade pact includes a provision that allows for “accession by any state or separate customs territory 18 months after the date of entry into force”.

Gepty is optimistic that more economies will seek to join the agreement.

“The RCEP has an open accession clause for any state or separate customs territory. Given the extent of economic activities in the region, such as research and development, product development, innovation, manufacturing and marketing, it is expected that more participation will be attracted from other states or customs territories,” he said.

One possible addition is India, home to nearly 1.4 billion people. The country was involved in RCEP negotiations from the start, but bowed out in 2019 over concerns that the deal could worsen the trade deficits India has with most of the other members.

While there have been no official moves by the Indian government to join the agreement, analysts in the country have suggested that it could benefit from such a move.

Several RCEP members, including China, Japan and Australia, have suggested that it would be advantageous for India to join the RCEP, with Japan saying that this is “in India’s interest”.

Japan’s Cabinet secretary for public affairs, Noriyuki Shikata, told journalists on March 20: “The RCEP will benefit the Indian economy with a better supply chain, especially with Asean countries. India will be treated exceptionally as a founder member.” 

Source: The Star

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