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Fifteen Asian countries sign the largest free trade agreement on the planet, which will affect more than 2.2 billion people. China is thus potentially strengthening its weight in world trade.
The “Regional Comprehensive Economic Partnership” (RCEP) brings together the 10 countries of the ASEAN free trade area, as well as China, Japan, South Korea, New Zealand and Australia. This together represents a market of more than 2 billion 200 million inhabitants, or 30% of the world population and more than 26 billion dollars, again almost a third of world GDP. It is more than any trade agreement on the planet, even more than the European Union.
Like any free trade agreement, the RCEP will first allow tariff cuts and simplification of customs procedures, especially for automotive and electronic components.
On the other hand, the partnership imposes very few regulations: nothing in particular on environmental or social standards. For the majority of these countries, this is not going to change much as a number of them already had bilateral or ASEAN agreements. But this is the first time that Japan has signed such an agreement with South Korea and especially that China has signed with Japan – countries that have had trade rivalries for a long time.
China is thus increasing its commercial potential and marking a big blow, especially against the United States. She had also agreed to participate in negotiations in 2012 to counter an American initiative under Barack Obama. The latter wanted to build a Trans-Pacific Free Trade Area (TPP) between several countries in Asia, Latin America and North America. But Donald Trump slammed the door to these negotiations in 2017 and the TPP was done without the United States, which is therefore not part of a free trade area with Asia.