(Washington, DC) The US-ASEAN Business Council (US-ABC) and its members congratulate the successful ratification of the Regional Comprehensive Economic Partnership (RCEP) agreement by six ASEAN member states – Brunei Darussalam, Cambodia, Lao PDR, Singapore, Thailand, and Vietnam – along with Australia, China, Japan and New Zealand, which satisfies the agreement’s criteria for bringing it into force. After an eight-year-long negotiation process, RCEP will enter into force effective January 1, 2022. US-ABC also commends ASEAN on achieving its top regional trade policy goal, which reflects the region’s strong commitment to deepening regional economic integration and trade to support its post-COVID-19 economic recovery efforts.
“We salute ASEAN for its leadership as the region negotiated and ratified RCEP, especially during a global pandemic. This accomplishment further cements the principle of ‘ASEAN Centrality’ in Asia’s regional economic architecture,” said US-ABC President & CEO Ambassador Ted Osius. "The implementation of the agreement will not only boost post-pandemic economic recovery efforts, but also remove tariffs on 91 percent of goods, standardize trade regulations, and promote supply chain optimization within the free-trade zone."
“Beginning January 1, 2022, RCEP will not only become the largest free trade agreement in the world, but it also will drive the most significant evolution of the Indo-Pacific's regional trade landscape in the 21st century,” said US-ABC Senior Vice President for Policy Marc Mealy. “At a time when global supply chains have been disrupted and economic growth slowed by the economic shocks related to the global pandemic, RCEP’s harmonized Rules of Origin (ROI) provisions and import tariff reductions can help support international trade-led economic recovery efforts in Asia. Businesses with regional supply chains will see commercially significant benefits in the form of reduced costs and enhanced predictability in the cross-border trade of goods and services.”
In addition to RCEP, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) as well as Singapore’s Digital Economy Partnership Agreement (DEPA) and Digital Economic Agreement with Australia (DEA) are currently shaping many of the commercial rules of the road in the Indo-Pacific. As the United States is not party to any of these trade agreements, the official conclusion and ratification of RCEP only increases the pressure on the Biden-Harris Administration to put forward a proactive trade agenda for the Indo-Pacific.