RCEP opens up 2.2 billion consumer market, limits protectionism

If RCEP economies can be united to have a common voice, they will be able to overcome protectionism and unilateralism to develop.

Promoting regional integration

RCEP, the Regional Comprehensive Economic Partnership, was inked by 15 member countries on November 15, which was a milestone in the economic integration process of Vietnam and the members of the agreement.

RCEP opens up 2.2 billion consumer market, limits protectionism

The other RCEP economies have the same products as Vietnam

With 20 chapters, the agreement covers areas and principles not found in previous trade agreements between ASEAN and partner countries.

According to Minister of Industry and Trade Tran Tuan Anh, RCEP creates a vast market with 2.2 billion consumers, or 30 percent of the world’s total population, and with GDP of $27 trillion, or 30 percent of the global total GDP, which will be the largest free trade area in the world.

With the commitments on market opening in goods, services, and investments and the harmonization of rules of origin among member countries, as well as the strengthening of measures to facilitate trade, the agreement will create favorable conditions to develop new supply chains in the region.

RCEP is expected to create long-term stable export markets for Vietnam and ASEAN countries.

The most important significance that Anh mentions is the central role of ASEAN in the process of shaping regional structuring, because RCEP is the largest regional economic link in which ASEAN takes the leading role. RCEP is the first initiative proposed by ASEAN and supported by partner countries.

Because of rising protectionism trend and unilateralism, member countries could not finish the negotiations for some time. In recent years, finalizing negotiations and signing the agreement was an important goal of the states holding the ASEAN chairmanship in recent years.

Because of rising protectionism trend and unilateralism, member countries could not finish the negotiations for some time. In recent years, finalizing negotiations and signing the agreement was an important goal of the states holding the ASEAN chairmanship in recent years.

This showed that if member countries can be united to have a common voice, they can be a driving force to accelerate regional cooperation for development.

In its report titled ‘Vibrant Vietnam – Forging the Foundation of a High-income Economy’ released last May, the World Bank mentioned the role of RCEP in linking regional countries.

According to the World Bank, because of the increasing importance of Asia, stronger regional integration will bring important long-term benefits. If trade and investment relations with western countries become tense, regional integration in Asia would have significant strategic value for Vietnam in preventing isolation from important markets in the world.

The World Bank commented that Vietnam’s participation in CPTPP and RCEP brings great opportunities to accelerate the agenda on tariff and non-tariff barrier cuts in the region. The strategic investments in enhancing cross-border connectivity in the region will also help reduce logistics and trade costs.

 

No tax cut shock

Like other free trade agreements, RCEP will bring both opportunities and challenges. First of all, it will put pressure on Vietnam’s goods and services.

The other RCEP economies have the same products as Vietnam, and the products are competitive. Meanwhile, the quality and the content of added value in Vietnam’s products remain modest.

The input materials for Vietnam’s production rely on imports, and the capability of improving the country's position in the regional value chain is limited.

Will the RCEP membership lead to an increase in deficit in the trade relations with RCEP member economies?

Minister of Industry and Trade Tran Tuan Anh said there was no need to worry too much about a trade deficit. He believes that Vietnam’s enterprises, which are mostly small and medium, will have many opportunities to join new supply chains to be created by RCEP if they can fully exploit the advantages the agreement brings.

Agreeing with Anh, some experts said that Vietnam already has FTAs with some RCEP member countries, so the benefits from RCEP would be higher if Vietnam's trade and investment institutions can help implement RCEP in harmonization with existing FTAs.

On a broader scale, the implementation of RCEP would strengthen autonomy and resilience of the economy to mitigate the adverse effects of economic - trade - investment developments in the region.

Experts believe that the sooner the preparation for RCEP implementation begins, the bigger and more robust the benefits will be.

In related news, Tuoi Tre reported that the Asian stock markets, except for Australia and India, were lit green on the morning of November 16, one day after the 15 economies signed to establish the world’s largest trade alliance RCEP.

Nikkei 225 increased by 1.19 percent, and Kospi 0.81 percent. 

Duy Anh

Foreign media highlights RCEP signing, praises Vietnam's ASEAN chairmanship

Foreign media highlights RCEP signing, praises Vietnam's ASEAN chairmanship

Foreign media outlets have run various headlines on the signing of the world’s largest trade deal – the RCEP, with ASEAN at the centre during the grouping’s summit virtually hosted by Vietnam as ASEAN 2020 Chair last week.

Signatories highlight RCEP’s significance to economies

Signatories highlight RCEP’s significance to economies

Signatories of the Regional Comprehensive Economic Partnership (RCEP) Agreement affirmed its significance to each country’s economy and regional trade-investment activities following the signing of the pact on November 15.

 
 

Other News

.
Diplomatic efforts affirm Vietnam’s position in international arena amid COVID-19
Diplomatic efforts affirm Vietnam’s position in international arena amid COVID-19
FEATUREicon  26/12/2020 

The diplomatic sector has continued to affirm Vietnam’s position in the international arena amid the global impact of the COVID-19 pandemic, Deputy Prime Minister and Foreign Minister Pham Binh Minh has said.

Deputy Minister of Defense reviews VN’s defense strategy in the new situation
Deputy Minister of Defense reviews VN’s defense strategy in the new situation
FEATUREicon  25/12/2020 

Deputy Minister of Defense, Senior Lieutenant General Nguyen Chi Vinh reviews Vietnam’s military and defense hallmarks in 2020.

Prime Minister: "Digital technology enterprises must pioneer in innovation"
Prime Minister: "Digital technology enterprises must pioneer in innovation"
FEATUREicon  26/12/2020 

At the National Forum on Developing Digital Technology Businesses 2020, Deputy Minister of Information and Communications Phan Tam read a letter from Prime Minister Nguyen Xuan Phuc to the Vietnamese digital technology business community.

“Make in Vietnam” and "tell your Vietnamese story":  MIC Minister
“Make in Vietnam” and "tell your Vietnamese story": MIC Minister
FEATUREicon  25/12/2020 

Minister of Information and Communications (MIC) Nguyen Manh Hung has called on every Vietnamese citizen and enterprise to take part in “Make in Vietnam” and tell their own Vietnamese story.

Central bank’s policies conductive to FDI, economic resilience: HSBC
Central bank’s policies conductive to FDI, economic resilience: HSBC
FEATUREicon  26/12/2020 

The central bank of Vietnam has taken both monetary and fiscal policies all together to ensure macro and social stability.

Why Vietnam’s outlook for 2021 looks bright?
Why Vietnam’s outlook for 2021 looks bright?
FEATUREicon  25/12/2020 

The country is projected to grow 6.8% in 2021 on condition that the pandemic be contained.

Vietnam's top 10 science and technology events in 2020
Vietnam's top 10 science and technology events in 2020
FEATUREicon  25/12/2020 

The 10 events were voted on by 60 science and technology journalists at 25 media agencies throughout the country.

Outstanding events in Vietnam in 2020
Outstanding events in Vietnam in 2020
FEATUREicon  25/12/2020 

Here are outstanding events in Vietnam in 2020.

Outstanding economic events of Vietnam in 2020
Outstanding economic events of Vietnam in 2020
FEATUREicon  24/12/2020 

Vietnam among very few countries to post GDP growth rate of 2.5-3 percent, and the signing of RCEP agreement in 2020 when Vietnam assumes ASEAN Chairmanship are among the top 10 domestic economic events in the year.

Minister of Health says local scientists are carefully monitoring new mutant coronavirus strain
Minister of Health says local scientists are carefully monitoring new mutant coronavirus strain
FEATUREicon  25/12/2020 

The new mutant coronavirus strain found in the UK can spread more rapidly, raising concern about the effect of vaccines. Vietnam plans to implement gene sequencing of the virus sample.

Hanoi’s landmarks stand the tests of time - The holly relics
Hanoi’s landmarks stand the tests of time - The holly relics
FEATUREicon  26/12/2020 

Founded over thousand years ago, Hanoi capital grew from swamplands into the charismatic city as it is today with hundreds of historical architecture works.

Local technology enterprises must regain the market
Local technology enterprises must regain the market
FEATUREicon  24/12/2020 

"Vietnam's overall economic growth rate is below 10%. The growth target for digital technology enterprise should be set at 15-20% and even more," said Deputy PM Vu Duc Dam at the National Forum for Developing Technology Enterprises.

Silent, painful reforms of the tax sector show positive results
Silent, painful reforms of the tax sector show positive results
FEATUREicon  23/12/2020 

The tax sector’s painful, quiet reforms have helped increase Vietnam’s position in the global business climate report.

2020 – the year of Vietnam’s national digital transformation strategy
2020 – the year of Vietnam’s national digital transformation strategy
FEATUREicon  25/12/2020 

The government considers the development of telecommunication infrastructure and IT as one of its top priorities.

Young H’mong man opens homestay on Ha Giang plateau
Young H’mong man opens homestay on Ha Giang plateau
FEATUREicon  26/12/2020 

With just VND500,000, Sung Mi Phin went from Ha Giang to Sa Pa in Lao Cai to study English and learn how to make money from tourism.

Textbook changes – a test of education reform
Textbook changes – a test of education reform
FEATUREicon  24/12/2020 

Minister of Education and Training Phung Xuan Nha noted before the National Assembly that the content of Canh Dieu (Kite), the textbook for first graders, is “not appropriate".

2020 - year of opening the door to the world
2020 - year of opening the door to the world
FEATUREicon  22/12/2020 

Vietnam's export growth this year has been impressive thanks to the signing and approving of many free trade agreements (FTAs), reflecting the success of the country's steady and flexible international integration process.

Do the Vietnamese still have a chance?
Do the Vietnamese still have a chance?
FEATUREicon  23/12/2020 

If you want to get over the rapids, you must first get off the boat. Will the next decade reach the goal of industrialization without success?

Unfinished dream to become a 'dragon'
Unfinished dream to become a 'dragon'
FEATUREicon  22/12/2020 

Vietnam’s industries, especially the processing and manufacturing industry, are developing. 

Vietnamese spend $10 billion on illegal football betting
Vietnamese spend $10 billion on illegal football betting
FEATUREicon  21/12/2020 

Ladbrokes, a British betting and gambling company, estimates that Vietnamese illegal football betting in Vietnam is worth 3-5 percent GDP (gross domestic product), or $10 billion a year.

 
 
 
Leave your comment on an article

OR QUICK LOGIN