JAKARTA – Fifteen nations in the Asia-Pacific region on Sunday signed the world’s largest free trade accord.
The Regional Comprehensive Economic Partnership Agreement (RCEP) was signed on the sidelines of the annual summit of the Association of Southeast Asian Nations (Asean) held via video link.
The accord includes 10 Asean member states: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam — along with Australia, China, Japan, New Zealand and South Korea.
Indonesia’s Trade Ministry said RCEP is the largest regional trade agreement in the world. The agreement takes effect once the participating countries ratify the agreement domestically within the next two years.
India was included in the trade pact, but the country withdrew from it last year. The agreement covers 29.6 percent of the world’s population, 30.2 percent of world gross domestic product, around 27.4 percent of world trade, and 29.8 percent of world’s Foreign Direct Investment (FDI), according to Indonesian Trade Ministry data.
The ministry said Indonesia had conceived the RCEP idea in 2011 and it was signed on Sunday after the negotiation process was completed. The trade pact is expected to bring more imported products in each Asean country, especially from China.
After the implementation of RCEP, Indonesia is estimated to have an increase in imports of up to US$101.9 billion from member countries. Prior to its implementation, Indonesia’s imports from member countries amounted to US$100.5 billion.
Indonesia’s exports after RCEP are estimated to only grow by US$997.7 million to US$91.96 billion. (Anadolu)