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Countries could come up with regional partnership by next year, Trade Secretary says

by December 16, 2016 General

By Imee Charlee C. Delavin, Senior Reporter

Posted on December 17, 2016

COUNTRIES negotiating the Regional Comprehensive and Economic Partnership (RCEP) could come up with an agreement by next year, the Philippines’ trade department said, as the country wraps up talks with Singapore in President Rodrigo R. Duterte’s latest overseas visit.

The parties involved are still working out the details of the RCEP including the extent each economies will be willing to open up their markets and the products to be included in the free trade agreement.

“After several years of discussion, I think we have a good chance of getting to a conclusion and coming up to an agreement by next year,” Department of Trade and Industry Secretary Ramon M. Lopez told reporters in a media briefing in Singapore yesterday.

Negotiations for the free trade deal began in 2012 in Phnom Penh, including the 10 members of ASEAN and six dialogue partners: Australia, New Zealand, India, South Korea, Japan, and China.

President Duterte, along with some members of his Cabinet, flew to Cambodia and Singapore on December 13 to 16 for his official state visits meant to bolster ties with the two nations.

A Singaporean senior minister also expressed confidence that the RCEP the parties involved “can deliver next year,” Mr. Lopez said. “RCEP will involve Japan, China, Korea, Australia, New Zealand and India, whose combined population would account for one-half of the world’s population. Combined economies would account for one-third of the world’s economy.”

The Philippine trade chief noted that RCEP is important to the country as “ASEAN accounts for about over 20% of our business, of our economy and specifically the trade.”

“If we look at the RCEP countries, they would account to over 50% of the Philippines’ trade. So it’s a big part of our economy, so it’s quite important that we really have that robust and vibrant trading arrangement, among the RCEP countries,” Mr. Lopez added.

Early this month, the Trade Secretary said countries negotiating the deal are considering opening up their markets to between 80% and 92% of all product categories and are working out how many products to include in RCEP.

The RCEP countries account for nearly 30% of global trade and are projected to have a combined gross domestic product of about $22.7 trillion.

The deal under negotiation is seen rivaling the Trans-Pacific Partnership (TPP) — a deal of similar size led by US, now thought to be endangered with the election of Donald J. Trump to the presidency. The potential members of the Trans-Pacific Partnership cover 40% of the world economy.

Mr. Lopez said then that the country is better off with RCEP, noting that it is “more relevant because it’s our region.”

“This is better. This is what we’ve been prioritizing ever since. The Philippines never has been a part of the TPP. We were not part of the first batch so it’s okay if TPP doesn’t go ahead.”

In a related development, Mr. Duterte’s foreign affairs secretary, Perfecto R. Yasay, Jr. said in his discussion with the Singapore Trade with Singapore’s Minister for Trade & Industry Lim Hng Kiang, the two agreed that countries in the region could weather expected negative impacts of headwinds brought by persisting overseas concerns.

“We were both confident that we will somehow surmount the negative projections that was declared or announced by the IMF at the APEC conference,” Mr. Lopez said.

International Monetary Fund Managing Director Christine Lagarde had said the institution will likely downgrade its 2016 global growth forecast again as economic prospects are dimmed by weak demand, flagging trade and investment and growing inequality.

Mr. Yasay said Mr. Duterte’s Singapore visit was “very fruitful and successful.”

“The sum total what was, the result is that we had forged a much stronger relationship with Singapore and committed to strengthen our trade, investment, and commercial relationship,” the head of the Department of Foreign Affairs said.