Asian trade ministers took another step toward creating what could be the world’s biggest trading bloc on Sunday, expressing hope that a deal could be signed by the end of this year.
“The path toward a year-end agreement is now clearer,” said Hiroshige Seko, Japan’s Trade Minister during the joint-press conference held Sunday. “As protectionism concerns increase globally, it’s important that the Asian region flies the flag of free trade.”
If ever fully achieved, the partnership would also include the 10 members of the Association of Southeast Asian Nations as well as South Korea, Australia and New Zealand, and cover one third of the world’s economy and almost half its population.
While the pact doesn’t seek to impose higher standards in areas such as labor and environmental protection, like the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership signed earlier this year, consensus continues to prove elusive.
Major obstacles include India’s requirement that any agreement to reduce tariffs on goods and services should allow for free movement of people, something India wants for its highly skilled information technology sector.
“There are great challenges to the global trading system at this point in time,” said Chan Chun Sing, Singapore’s Trade Minister Sunday. “It serves as added impetus for us to try and achieve a substantive conclusion to the RCEP process.”
Any further progress on RCEP could put pressure on the US to consider rejoining the TPP, as the US-China trade war continues. US President Donald Trump’s tariffs on $34 billion of Chinese goods are scheduled to kick in on July 6, a move that China has vowed to retaliate against.