BANGKOK: Asean leaders meeting this weekend in Bangkok are determined to drive forward the world’s largest trade pact, more than three years behind schedule, with the trade war between the US and China clouding the outlook for their export-led economies.
Disputes in the flashpoint South China Sea, Myanmar’s persecution of Rohingya Muslims and plastic pollution in the seas are also set to be discussed at the two-day Asean summit, chaired by Thailand.
But trade will take centre stage with Asean leaders keen to hasten the signing of a trade deal covering around half the world’s population. The Regional Comprehensive Economic Partnership (RCEP) includes all 10 Asean economies, plus India, Japan, South Korea, Australia and New Zealand.
It is seen as a mechanism for China to draft the rules of Asia-Pacific trade, following a US retreat from the region. The deal was originally supposed to have ben reached by the end of 2015, but negotiations have been bogged down amid disputes over protected lists and market access, mainly between China and India.
Shortly after his election, President Donald Trump pulled the US from the Trans-Pacific Partnership (TPP) —which would have been the world’s largest trade deal — slamming it as an American “job killer”.
While tit-for-tat tariffs between the world’s biggest two economies have seen some manufacturers flee China to safer Asean hubs, economists say the big picture for global growth is bleak.
In that context, “RCEP is key to increasing trade volume”, Thai government spokesman Werachon Sukhondhapatipak told reporters.
“The faster it (RCEP) gets implemented the better,” Martin Andanar, Philippines Communications Secretary, told reporters.
“Free trade is definitely what we need here in this region,” he said, adding that the US-China trade row has resulted in “the entire world catching a cold”.
Progress on the deal has sputtered with India digging in over fears cheap Chinese goods could flood its massive consumer market. Australia and New Zealand have also raised concerns over a lack of labour and environmental safeguards.