The Regional Comprehensive Economic Partnership

21 December 2020

The Regional Comprehensive Economic Partnership

Last month, 15 countries have signed a historic trade agreement. This brings more opportunities for economic growth for participating countries, including New Zealand. Furthermore, this agreement will create more certainty and stability for New Zealand exporters in the Asia-Pacific region.

China and 14 Asia-Pacific countries agree historic free trade deal

After eight years of negotiations, one of the biggest trade deals - The Regional Comprehensive Economic Partnership - has been signed by 15 countries. This deal unites 2.2 billion people and represents 30% of global economic output. The partnership includes New Zealand, Australia, Japan, South Korea, China and ASEAN, and sets terms for trade and cross-border investment between the participating countries. Originally, the deal also included India, however due to concerns for domestic industry the Indian government decided to pull out of the agreement. Despite this, there is a possibility of India joining the partnership in the future as the agreement will remain open to India. The RCEP trade deal is a part of economic recovery after the majority of countries around the world had to go into lockdowns during the Covid-19 pandemic. With this partnership, the countries’ leaders hope to support economic recovery through job creation, removal of trade barriers and strengthened supply chains. The RCEP is also more flexible, compared to CPTPP and the EU, as it does not have unified standards on labour and the environment. This means that this agreement can accommodate countries with vastly different economies and at different stages of development. The deal is expected to promote collaboration and growth for all participating countries.

Read the article on the Guardian website

Asia-Pacific trade deal to add 'certainty for New Zealand exporters' – minister

With the signing of the RCEP, New Zealand has created a stronger certainty for its exporters. The trade deals brings many opportunities for New Zealand businesses, as it removes trade barriers and opens up access to a third of the world’s population. The trade deal is expected to be in place in 2022, after it is ratified by all of the participating countries. The partnership will benefit the New Zealand economy by creating certainty and stability for its exporters, as well as by accelerating economic growth in the Asia- Pacific region. While the initiative is led by ASEAN, all participating countries will be equal in terms of the rules and measures outlined in the partnership. This means New Zealand has a chance to increase its economic advantage and its businesses can focus on creating further economic growth in the region. 

Read the article on the Radio New Zealand website

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