MBA 602 International Business Section: 960
IB News Article

11/29/12

Japan Dives into Trade Talks
ASEAN leaders begin RCEP negotiations

Summary:

An effort is being negotiated currently to launch a new regional comprehensive economic partnership called RCEP. The concept is this: to engage 16 Asia Pacific nations for free trade and to establish a trilateral free trade agreement with China and South Korea.

Negotiations in this landmark free trade pact are taking place now in Phnom Pehn following the ASEAN Summit. If or once it is formed the RCEP is likely to cover half of the world’s population and would be the largest regional trading arrangement in the world to date. The RCEP is a strategy aimed at maintaining regional growth by ensuring that markets of the participating countries remain open and competitive.
It is estimated that Japan’s GDP will grow by 1.1 percent with a wide range of partnership frameworks: tariff reductions and intellectual property protection. Under RCEP, which is different from individual country to country rules, there is a unification of rules and simpler business transaction procedures.

The potential free trade agreements between ASEAN and China, Japan, South Korea, India, Australia and New Zealand could eventually lead to the creation of an integrated market that spans 16 countries with a combined market population of more than 3 billion people and a combined GDP of about US$19.78 trillion based on 2011 figures. The barriers are the economic gap between the 16 potential members: GDP $67,000 - $804 and differences in economic activity.

The US-led TPP which stands for Trans-Pacific Partnership, On November 12, 2011, the Leaders of the nine TPP countries – Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, and the United States – announced the achievement of the broad outlines