RCEP will come into effect soon, what impact will it bring?

According to the website of the Ministry of Commerce, the ASEAN Secretariat, the custodian of the Regional Comprehensive Economic Partnership (RCEP), recently issued a notice announcing that six ASEAN member states including Brunei, Cambodia, Laos, Singapore, Thailand, Vietnam, and China, Japan, Four non-ASEAN member states including New Zealand and Australia have formally submitted their approval letters to the ASEAN Secretary-General, reaching the threshold for the entry into force of the agreement
.
According to the agreement, RCEP will enter into force for the above ten countries on January 1, 2022
.

China is ready to implement RCEP

The head of the Department of International Affairs of the Ministry of Commerce said recently that China attaches great importance to the preparations for the entry into force of RCEP.
On April 15 this year, the Chinese side submitted the approval letter to the ASEAN Secretary-General.
The relevant preparations were basically completed within six months after the signing of the agreement.
Preparations are in place to ensure full compliance when the agreement enters into force
.

First, in terms of preparations for the implementation of tariff reductions, China completed the conversion of the tariff reduction table in the first half of the year and submitted it to the ASEAN Secretariat
.
At present, the tax reduction implementation plan has entered the final stage of the domestic approval process, which can ensure that the tax reduction obligation can be fulfilled when the agreement takes effect
.
Second, in terms of preparations for the implementation of the rules of origin, the General Administration of Customs has formulated the RCEP Origin Management Measures and the Approved Exporters Management Measures in the first half of the year, which will be announced and implemented at the same time as the agreement takes effect
.
In response to the needs of RCEP origin management, the upgrade of the information system has been completed
.
At the same time, it will maintain close communication with the customs of other member states to ensure the full implementation of the rules of origin of the agreement
.
Third, the preparations for the performance of the binding obligations of the agreement have been completed
.
The fourth is to actively carry out publicity and training for localities and enterprises
.
Fifth, establish a free trade zone implementation service platform
.

RCEP currently has a total of 15 member states, including 10 countries including China that have submitted their approvals, and 5 member states
.
According to the introduction of the Ministry of Commerce, the signatories of the relevant agreements are currently accelerating the domestic approval process, and all have indicated that they will complete the approval as soon as possible
.
According to the relevant provisions of RCEP, the agreement will enter into force on the 60th day after these countries have completed the approval process, submitted the approval letter, and officially accepted the approval letter by the ASEAN Secretary-General
.
"China expects RCEP to enter into force for the above signatory countries as soon as possible, so that the agreement will be fully implemented in the region as soon as possible, and fully release the potential of the agreement to promote regional post-epidemic recovery, consolidate industrial and supply chains and promote economic development
.
"

Promote regional economic recovery

Looking back at the entire negotiation process of RCEP, it is not difficult to find that it was accompanied by challenges such as the rise of unilateralism and trade protectionism, the adverse current of economic globalization, and the global pandemic of the new crown pneumonia epidemic
.
But even in the face of these challenges, the RCEP negotiation can still continue.
It was officially signed in November last year and will take effect on January 1 next year, which fully reflects the firm will of RCEP members to maintain and develop multilateralism and free trade.
, is a firm support for global multilateralism and free trade
.
Chen Yang, a researcher at the Charhar Institute and a visiting researcher at the Japan Research Center of Liaoning University, said in an interview with a reporter from China Trade News that affected by the epidemic, the economies of countries in the Asia-Pacific region have suffered varying degrees of impact.
The implementation of RCEP will help various countries.
The economic recovery of member states will further promote the post-pandemic recovery of the regional and even global economy
.

ASEAN Secretary-General Lin Yuhui said that after the agreement takes effect, higher levels of opening up, larger markets and better policies will give birth to more development opportunities and potential
.
According to estimates by the Peterson Institute for International Economics in the United States, by 2030, RCEP is expected to drive a net increase of $519 billion in exports and a net increase of $186 billion in national income
.

"Compared with other trade agreements, the level of economic development among RCEP member countries is quite different, and the industries are highly complementary
.
" Ma Yingying, an assistant researcher at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences, said that the entry into force of RCEP means that 91% of the commodities Tariffs will be gradually eliminated, coupled with the reduction of non-tariff barriers, the establishment of unified rules for services and investment, and the level of trade and investment facilitation will be greatly improved
.

In addition, the head of the International Department of the Ministry of Commerce said that RCEP will gradually bridge the differences in development levels among members by increasing economic and technical assistance to developing economies and least developed economies, effectively promote coordinated and balanced regional development, and promote the establishment of A new pattern of open regional economic integration
.

Deepen Sino-Japanese economic and trade exchanges

"The 'Rules of Origin' in RCEP is very worthy of attention, which means that it can bring significant cost reductions to more companies
.
" said Bai Ming, deputy director of the International Market Research Institute of the Ministry of Commerce Research Institute, especially the accumulation of origin.
The rules help companies optimize supply chains and reduce procurement costs
.

Lin Lan, vice chairman of Hisense Group Holding Co.
, Ltd.
, said that under RCEP's "zero tariff target" and "rules of origin", in the RCEP area, the cycle from financing to raw materials, to processing, production and even sales has become possible
.
For manufacturing companies such as Hisense, this means that the raw materials needed for manufacturing will flow at lower costs throughout the region, and the competitiveness of the industrial chain and supply chain will be further enhanced
.
"In 2021, Hisense expects to purchase more than 15 billion yuan from overseas, of which about 60% will come from RCEP member countries
.
By 2025, Hisense's overseas purchase scale target is 32 billion yuan, and the proportion of RCEP member countries' procurement will not be less than 70%.

.
"

"After RCEP comes into effect, Chinese enterprises will import advanced technology, important equipment, key components, consumer goods, medicine and nursing equipment, as well as import design and development, energy conservation and environmental protection and other productive services at a lower cost, so as to better meet the China's domestic market needs to upgrade consumption
.
" Chen Yang said, and through RCEP, China and Japan reached a bilateral tariff reduction arrangement for the first time, and the proportion of zero-tariff goods imported by China from Japan will be expanded from 8% to 86%, which will benefit many industries.

.

It is reported that after the RCEP came into effect, some products imported by China from Japan were immediately reduced to zero tariffs, such as speakers, the tariff in the first year was reduced from 10% to zero
.
Some have reduced taxes year by year.
The tariffs on electric ovens, induction cookers, and rice cookers have been reduced from 15% year by year to zero after ten years
.
At the same time, Japan will have zero tariffs on 88% of China's tariff lines.
For example, in the field of agricultural products, Japan will open about 65% of tax items
.

"In the context of the severe epidemic situation, Japan's total exports to China in 2020 decreased by 11.
1%, but its exports to China increased by 2.
7%; the ratio of Japan's exports to China to total exports increased to 22%, and Japan's exports to China accounted for 22% of total exports.
For the first time, China has replaced the United States as Japan’s largest exporter
.
” Chen Yang said, this fully reflects the strong resilience of China-Japan economic and trade cooperation, and through RCEP, China and Japan have Tariff barriers will be gradually eliminated, which will promote the deepening development of China-Japan economic and trade cooperation after the epidemic, and the early realization of the China-Japan-Korea Free Trade Zone
.