No deal on mega trade pact

Philippine Daily Inquirer - - BUSINESS - By Roy Stephen C. Canivel @roy­canivel_INQ

A mega trade deal that would have linked around 30 per­cent of the global econ­omy failed to find a sub­stan­tial con­clu­sion this year.

Some coun­tries be­hind the pro­posed Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP) still could not agree on some con­tentious is­sues even af­ter 20 rounds of ne­go­ti­a­tions held within the year.

Ac­cord­ing to Trade Un­der­sec­re­tary Ce­ferino Rodolfo, the prob­lem was not with the As­so­ci­a­tion of South­east Asian Na­tions (Asean), but with some of the bloc’s FTA part­ners, which he de­clined to iden­tify.

In a press brief­ing yes­ter­day, Rodolfo read the pre­pared speech of Asean Eco­nomic Min­is­ters (AEM) Chair Ra­mon Lopez, who is also trade and in­dus­try sec­re­tary of the Philip­pines. In the speech, Lopez said that reach­ing a sub­stan­tial con- clu­sion re­mained to be the goal.

This, how­ever, might not come this year when the Philip­pines is host­ing as chair of the Asean for its 50th An­niver­sary.

“The sub­stan­tial con­clu­sion of [ RCEP] re­mains a work in progress,” Lopez said.

Half a decade has passed since RCEP ne­go­ti­a­tions be­gan among Asean mem­ber states and six FTA part­ners—Aus­tralia, New Zealand, In­dia, Korea, Ja­pan and China.

Nev­er­the­less, Lopez said that that there was still “sig­nif­i­cant progress” in the talks, cit­ing the fi­nal­iza­tion of the scope of the deal un­der the RCEP Key El­e­ments for Sig­nif­i­cant Out­comes by end of 2017 and the Col­lec­tive As­sess­ment Re­port.

The “Key El­e­ments” doc­u­ment out­lines the po­si­tion of the par­ties in­volved. The as­sess­ment re­port, on the other hand, re­viewed the progress of the dis­cus­sions, in­clud­ing their hits and misses. Copies of both doc­u­ments were not shared to the press.

“In view of the large po­ten­tial of the RCEP to pro­mote global trade and growth, we will re­main deeply com­mit­ted to swiftly and suc­cess­fully achiev- ing a mod­ern, com­pre­hen­sive, high-qual­ity and mu­tu­ally ben­e­fi­cial RCEP agree­ment that will re­dound to in­creased job gen­er­a­tion, and sus­tain­able, in­clu­sive and in­no­va­tion-ori­ented growth,” Lopez said.

In nu­mer­ous oc­ca­sions this year, Lopez re­it­er­ated that a sub­stan­tial con­clu­sion of the deal would be one of the pri­or­ity de­liv­er­ables of the Philip­pines as Asean chair. In Septem­ber, he even called on other coun­tries to have “more re­al­is­tic am­bi­tions” as talks re­mained con­tentious.

De­spite this, the first ever RCEP Sum­mit was held in Manila yes­ter­day, which Lopez said sent a “strong sig­nal” of con­tin­u­ing co­op­er­a­tion for com­mon ar­eas of in­ter­est “con­trary to grow­ing promi­nence of pro­tec­tion­ism and anti-glob­al­iza­tion sen­ti­ments world­wide.”

In an in­ter­view, Rodolfo, who serves as the Philip­pine lead for the AEM, ex­plained that there were is­sues among FTA part­ners that kept talks from fur­ther pro­gress­ing.

“With the RCEP, we can see that de­vel­oped coun­tries are will­ing to open their mar­kets to sec­tors of in­ter-

est to Asean. The prob­lem here is re­ally among them, and we’re just be­ing af­fected,” he said in a mix of English and Filipino.

Fur­ther de­tails of the trade talks have been kept se­cret, but Lopez pre­vi­ously said the Asean found it dif­fi­cult to reach an agree­ment with some FTA part­ners re­gard­ing the ex­tent of lib­er­al­iza­tion in the trade in goods. He said the Asean would not ac­cept an of­fer higher or lower than 92 per- cent.

Sin­ga­pore, which would as­sume chair­man­ship of the Asean next year, would now have the chance of an­nounc­ing the talks’ sub­stan­tial con­clu­sion un­der its term.

A sub­stan­tial con­clu­sion, how­ever, does not mean that a trade deal would be signed al­ready, ac­cord­ing to Lopez in a pre­vi­ous in­ter­view. He clar­i­fied that this could mean that there would be a con­sen­sus on the ba­sic frame­work of RCEP.

Ac­cord­ing to the Asean web- site, the ob­jec­tive of RCEP ne­go­ti­a­tions was to have a “mod­ern, com­pre­hen­sive, high-qual­ity, and mu­tu­ally ben­e­fi­cial eco­nomic part­ner­ship agree­ment.”

In other words, this means that the RCEP has the po­ten­tial to de­liver “sig­nif­i­cant op­por­tu­ni­ties” for busi­nesses in East Asia —in­clud­ing small- and medi­um­sized en­ter­prises (SMEs)—since they would gain bet­ter mar­ket ac­cess to the 16 coun­tries in­volved, which col­lec­tively ac­count for close to half of the world’s pop­u­la­tion.

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