RCEP 'may be delayed' as economies rebuild

Legislation | | MIC Customs Solutions |

The Regional Comprehensive Economic Partnership may not be signed this year as originally planned.

Despite significant progress already having been made towards the Regional Comprehensive Economic Partnership (RCEP) free trade agreement, the deal may now have to be put on hold.

According to Kyodo News, Japanese prime minister Shinzo Abe is facing significant domestic opposition to his plans to continue discussions for the pact at a time when coronavirus is devastating the economy.

Set to be the world's biggest FTA, involving 16 Asia-Pacific countries and half of the world's population, Japan had been a key driver of RCEP since its inception in 2012 in a bid to boost exports.

Now, though, with the nation likely to be forced into recession as industry grinds to a halt in order to stop the spread of the pandemic, experts are calling for Mr Abe to make shoring up Japan's beleaguered economy a priority going forward.

A Japanese government source told the news provider: "Japan should put more emphasis on economic rehabilitation than on free trade, at least this year."

Junichi Sugawara from Tokyo's Mizuho Research Institute agreed, adding: "Unfortunately, I believe it would be very difficult for the 16 countries to reach the RCEP agreement this year."

However, both Thailand and China have insisted they would be behind pressing on with RCEP with a view to signing this year despite the world's health woes, as long as discussions can take place via videolink.