The Regional Comprehensive Economic Partnership (RCEP) was signed on Sunday in Vietnam by 15 nations in South East Asia, including Australia and New Zealand. The new trade block will have a GDP of $26.2 trillion and 2.2 billion people, making it the largest in the world.
This was disclosed in a Bloomberg report on Sunday evening.
The deal was finally signed at the 37th Asian Summit, hosted virtually by Vietnam after nearly 10 years of planning.
“The completion of negotiations is a strong message affirming Asean’s role in supporting the multilateral trade system,” Vietnamese Prime Minister, Nguyen Xuan Phuc said.
He added that the RCEP will grow supply chains that have been disrupted due to the pandemic, as well as supporting economic recovery.
The deal which covers about a 3rd of the global population will reduce tariffs by about 92% in economies affected by the pandemic, increase supply chain development in the region, and codify e-commerce rules.
“Among the benefits of the agreement include a tariff elimination of at least 92% on traded goods among participating countries, as well as stronger provisions to address non-tariff measures, and enhancements in areas such as online consumer and personal information protection, transparency and paperless trading, according to a statement issued on Sunday by Singapore’s Ministry of Trade and Industry,” Bloomberg reported.
“It also includes simplified customs procedures, while at least 65% of services sectors will be fully open with increased foreign shareholding limits.”
What you should know
Bigwig FX reported last week that 15 Asian nations led by China were expected to sign the world’s largest free trade agreement, which aims to reduce tariffs and improve supply chains between Asian nations. However, India withdrew from negotiations in 2019.