RCEP deal goes down to wire

BANGKOK, Nov 4, 2019, Bangkok Post. All eyes are on the fate of the Regional Comprehensive Economic Partnership (RCEP) at the 3rd Summit to be held on Monday amid reports that the agreement may not be signed this year, Bangkok Post reported.

Thailand, as the chair of Asean, announced in September that the bloc and all RCEP dialogue partners had agreed to conclude the negotiation by the end of this year.

The RCEP is a proposed free-trade agreement between the 10 member states of the Association of Southeast Asian Nations (Asean) and six dialogue partners, namely China, Japan, South Korea, India, Australia and New Zealand. When the agreement is reached, the RCEP will cover nearly half of the global economy.

“The early conclusion of RCEP negotiations will lay the foundation for East Asia’s economic integration,” China’s Foreign Ministry said after Premier Li Keqiang met Southeast Asian leaders.

But Indian Prime Minister Narendra Modi did not even mention the RCEP deal in opening remarks at a meeting with Southeast Asian leaders and instead spoke only of reviewing the existing trade agreement between Asean and India.

Nor did Mr Modi mention the trade bloc, whose 16 countries would account for a third of global gross domestic product and nearly half the world’s population, in Twitter posts after meeting Thai and Indonesian leaders.

An Indian Foreign Ministry official later told a media briefing: “Let’s take all the RCEP questions tomorrow”.

A government source, who asked not to be named, said the Thai officials are confident that a joint statement will be announced to the RCEP negotiations, but whether it will be a 16-country conclusion or a 15-countries-plus-one conclusion is still in doubt.

India is reluctant, with concerns over its producers’ competitiveness, and fear that opening its market will draw an influx of cheap goods from China, the source said.

Ministerial meetings also took place on Sunday as the economic ministers of the 16 countries tried to at least come to an agreement in principle, the source said.

Prime Minister Prayut Chan-o-cha on Sunday met his Indian counterpart during the Asean-India summit and tried to convince Mr Modi to say yes, the source said.

Government spokeswoman Narumon Pinyosinwat said the ministers of some countries would hold internal discussions before any agreement was announced.

India, too, is concerned, in particular over investment protection and also wanted to discuss the matter internally, she said.

However, according to the process, even if the negotiations are concluded, the signing of the RCEP agreement cannot happen until 2020 after each country finishes its required legal process, she said.

“Commerce ministers are still discussing outstanding issues. The signing is expected around February next year, Ms Narumon said.

Free trade has been a sensitive issue since the RCEP negotiations began in 2012, mainly due to the lack of free trade agreements between some partners.

However, up to 18 out of the 20 chapters in the proposed free trade agreement have been agreed, the source said.

The closing ceremony and the handing over of the chairmanship to Vietnam will take place today. However, Thailand will continue to serve as chairman until the end of the year.