Asean+6 to announce RCEP results

Asean+6 to announce RCEP results

Trade bloc slated for next year

The Asean+6 grouping is expected to declare the outcome of free trade talks under the Regional Comprehensive Economic Partnership (RCEP) at the Asean Summit to be held in Kuala Lumpur from Nov 19-22.

The joint declaration will pave the way for the China-led trade bloc to become enforced next year.

Sunanta Kangvalkulkij, deputy director-general of the Trade Negotiations Department, said Asean leaders were scheduled to meet their counterparts from China, Japan, South Korea, Australia, New Zealand and India at the 27th Asean Summit to discuss the feasibility of accelerating the tariff cuts under the RCEP after the Trans-Pacific Partnership (TPP) trade agreement was reached by 12 Pacific Rim nations on Oct 5.

"At the upcoming summit, China is expected to play a vital role in pushing up the conclusion of the talks," she said.

"After the talks, Thailand needs to speed up amending laws and regulations to conform to the pact and accommodate new business developments such as e-commerce."

A total of 16 members tentatively agreed at the 10th meeting of negotiating teams from Oct 12-16 in Busan, South Korea to eliminate tariffs on 65% of all goods, amounting to 8,000-9,000 items, under the RCEP plans.

Of the 35% of total products not included in the initial agreement, RCEP members are expected to gradually cut tariffs to zero within 10 years after 2017 for 20%, while further talks are needed for the other 15% of products, which are mostly sensitive items.

The RCEP was launched in November 2012 with the aim of establishing deeper economic cooperation between the 10 Asean members and Australia, China, India, Japan, New Zealand and South Korea, with a focus on trade in goods, services and investment.

If signed, the agreement will create an economic bloc with a combined population of 3.5 billion and trade volume of US$10.7 billion, accounting for nearly 30% of the world's trade.

China has been seen as the key driver of the regional trade pact, which is viewed as an alternative to the US-led TPP, from which the world's second-biggest economy was excluded.

Within the RCEP, seven countries -- Australia, Japan, Malaysia, New Zealand, Singapore, Vietnam and Brunei -- are part of the 12-nation TPP.

Thailand exported goods worth $127 billion to RCEP countries in 2014, making up 56% of export value. Key exports were cars and auto parts, plastic pellets, chemicals, computers and parts, and rubber and rubber products. Imports mainly for machinery and parts, steel and steel products, crude oil and integrated circuits totalled $133 billion, represented 58% of Thailand's import value.

Imports from RCEP members amounted to $133 billion or 58% of import value. Direct investment from RCEP members totalled 280 billion baht in 2014, or 70% of foreign direct investment.

"The RCEP, if implemented, will benefit Thailand in all aspects, be it trade in goods, services or investment," said Mrs Sunanta. "Compared with the TPP, the RCEP sounds much more interesting, as the latter contains China and India, each with a population of more than 1 billion."

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