Based on a document obtained by AFT on Tuesday, a free-trade zone that would cover over half the world’s is set for the month with the participation of Sixteen Asia-Pacific countries. The initiative is very important as it includes the three major drivers of emerging markets growth — China, India and ASEAN. Potential members have said they are keen to make progress on the Regional Comprehensive Economic Partnership (RCEP) despite being engaged in diplomatic rows over various rival territorial claims in the region.
Despite bitter territorial rifts among planned members, including China, Japan and some Southeast Asian nations, the negotiations for RCEP is poised to go ahead. China, the Philippines, Vietnam, Brunei and Malaysia have competing claims to parts of the South China Sea, and tensions have escalated in recent years amid complaints of increased Chinese aggression. China and Japan are locked in an even more tense dispute over islands in the East China Sea. The South China Sea disputes remain an important risk to East Asian relations, with growing evidence of a regional arms race.
Nevertheless, China and ASEAN can be expected to give a high strategic priority to pursuing their RCEP negotiations, given the growing importance of intra-Asian trade as a regional growth driver.
After launching the process last year at a summit in Phnom Penh, the kickstarting of the talk is expected from the leaders of the Association of Southeast Asian Nations (ASEAN). These leaders will converge in Brunei on Wednesday and Thursday. These leaders are in view that the talk will be completed by 2015. This view are based on the chairman’s end-of-meeting statement that was obtained by AFP.
The draft stated that the leaders of ASEAN looked forward to the broadening and deepening of existing (free-trade agreements) and envisioned the RCEP to be a platform for future trade and investment integration in Asia and the rest of the world. The draft stated, which is prepared by senior officials is not permanent and could be changed.
According to a senior Southeast Asian trade official, the first round of RCEP negotiations is expected to start on May 9.
The RCEP covers ASEAN’s 10 member countries — Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam — as well as Australia, China, India, Japan, New Zealand and South Korea. Together, the negotiating countries encompass more than three billion people and generate about one-third of global economic output.
The pact aims to tie together ASEAN’s bilateral free-trade agreements with each trading partner, but excludes the United States which is leading talks for a rival trade agreement called the Trans-Pacific Partnership (TPP).The TPP currently involves 12 countries: Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.
Both the RCEP and TPP join a profusion of regional trade pacts that are moving forward, in contrast to the World Trade Organization’s moribund Doha round of global talks.
Rajiv Biswas, chief regional economist at IHS Global Insight, told AFP that the RCEP provides an important platform for building trade liberalisation within the Asia-Pacific, which is the world’s fastest growing region.
And in another territorial row, relations between Tokyo and Seoul have been strained by a dispute over a Seoul-controlled chain of islets in the Sea of Japan (East Sea).
Biswas said parties would likely keep pressing ahead on deepening trade links, even if tensions over the territorial disputes continued to rise.
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