RCEP: The largest free trade agreement at the globe was officially signed

On November 15, 2020, within the framework of the 37^th ASEAN Summit, Prime Minister Nguyen Xuan Phuc presided over the online signing ceremony of countries participating in the negotiation of the Regional Comprehensive Partnership Agreement (RCEP)

The RCEP is the most ambitious new-generation free trade agreement initiated by ASEAN, contributing to enhancing ASEAN's central role in the region and strengthening cooperation between ASEAN and partner countries.

The free trade agreement involving Japan, China, Korea, Australia and New Zealand and 10 members of the Association of Southeast Asian Nations (ASEAN) would create a large free trade zone in Asian markets with 2.2 billion people, accounting for 30% of the world's population, total GDP of 26.2 trillion USD equivalent to 30% of GDP and nearly 28% of global trade. The RCEP Agreement is the largest free trade agreement in the world, representing an important step towards an ideal legal framework for global trade and investment.

The RCEP would reduce tariffs and establish rules in about 20 sectors, including cross-border flows of goods. For Japan, the agreement would further reduce tariffs on agricultural and fishery products compared with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) or the Viet Nam – Japan Economic Partnership Agreement (VJEPA).

The RCEP would eliminate tariffs for 61% of goods exporting to Japan from ASEAN members, Australia and New Zealand, along with 56% to China and 49% to South Korea.

Given the fact that the negative effects of COVID-19 have created many challenges to the movement of trade and investment flows in the region, the rapid signing of the RCEP is expected to greatly boost development of value chains regionally and globally, helping ASEAN economies recover and develop, including Vietnam and partner countries.

In addition, in the context that the world and the regional economy is facing certain obstacles of trade protection, the successful signing will contribute to the creation of a new trade structure in the region to push the globalization towards sustainable trade liberalization and facilitation