Barton Deakin Brief: Regional Comprehensive Economic Partnership Formalised
16 November 2020
Yesterday, Prime Minister the Hon. Scott Morrison MP and Minister for Trade, Tourism and Investment, Senator the Hon. Simon Birmingham announced that the Regional Comprehensive Economic Partnership (RCEP) Agreement between Australia and fourteen Indo-Pacific countries has been signed and formalised.
RCEP is the world’s largest free trade agreement, representing countries with nearly 30% of global GDP and the world’s population. RCEP centres on a shared regional commitment to open trade and investment – covering trade in goods, trade in services, investment, economic and technical cooperation, and new rules for electronic commerce, intellectual property, government procurement, competition, and small and medium sized enterprises.
Australia will seek to ratify the Agreement in 2021.
RCEP Agreement Background
RCEP negotiations began in 2012 between the ten ASEAN nations (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam) and ASEAN’s free trade agreement partners (Australia, China, Japan, New Zealand and South Korea). India was originally involved in negotiations, however, withdrew before formalising the agreement over unresolved issues.
The RCEP Agreement will provide export and trade opportunities to Australian farmers, businesses, and investors. RCEP will also boost growth prospects in the Asia-Pacific region and promote development across regional economies. Specifically:
- RCEP will enhance Australia’s economic engagement with the Indo-Pacific through the provision of a single set of goods export procedures, based on preferential tariff outcomes.
- Rules of origin provisions will set common standards for determining whether products qualify for duty-free treatment, which will facilitate the establishment of new supply chains across member countries.
- Avenues to address non-tariff barriers, such as quarantine and technical standards, will be implemented to promote compliance with WTO rules and improve transparency.
- New market access commitments for service suppliers and investors in China and other ASEAN countries, such as Malaysia, the Philippines and Thailand.
- RCEP will deliver against the objectives in Australia’s Foreign Policy White Paper, specifically contributing to a stable and prosperous Indo-Pacific region.
The economic benefits of the Agreement have been emphasised as the world recovers from the COVID-19 pandemic.
The RCEP Agreement will be ratified consistent with Australian treaty-making procedures. The Agreement will be tabled, considered by the Joint Standing Committee on Treaties. It will enter into force 60 days after six ASEAN members and three other members have ratified the agreement.
Barton Deakin’s previous brief on RCEP