Finalization of ASEAN trade deal eyed in Bangkok summit

Published June 21, 2019, 5:45 PM

by AJ Siytangco

By Genalyn Kabiling

BANGKOK – Ten Southeast Asian nations are aiming to finalize a free trade agreement with six Asia Pacific countries by November to help insulate the bloc from the impact of the trade skirmish between the US and China.

Trade Secretary Ramon Lopez said economic ministers of the region hope to see progress in the negotiations on the proposed Regional Comprehensive Economic Partnership (RCEP) that allows a bigger, more open and rules-based market.

Trade Secretary Ramon Lopez speaks during a press conference on the sideline of the 34th Association of Southeast Asian Nations (ASEAN) summit in Bangkok on June 21, 2019. (Photo by Romeo GACAD / AFP / MANILA BULLETIN)
Trade Secretary Ramon Lopez speaks during a press conference on the sideline of the 34th Association of Southeast Asian Nations (ASEAN) summit in Bangkok on June 21, 2019. (Photo by Romeo GACAD / AFP / MANILA BULLETIN)

The proposed free trade pact, which will cover the 10-member ASEAN bloc, China, India, Japan, South Korea, Australia and New Zealand, will be tackled by the economic ministers ahead of the Association of Southeast Asian Nations’ leaders summit here.

“We shall have an ASEAN economic ministers’ meeting essentially just to discuss the RCEP so and then really ensuring that we are able to complete the major issues, address major issues towards August, September so that we can hopefully announce a conclusion towards November so that’s the time table we are looking at,” Lopez said in a media interview here.

“So at least in this part of the world, we would have this regional free trade agreement that can still improve the trading within the region and somehow be partially insulated from the impact of what’s going on between US and China,” he added.

He said RCEP, considered the biggest trade deal between the ASEAN bloc and six other countries, would promote greater market access for products and services.

The pact, which will cover trade in goods and services, investments, economic and technical cooperation, intellectual property rights, among others, is expected to expand the ASEAN market from 600 million to 3.5 billion.

Lopez admitted that the negotiations on the free trade deal involving 16 countries have taken so long due to many factors. He noted that not all countries were on the same level of preparedness for trade liberalization and development.

“It’s really a long comprehensive FTA agreement imagine involving also 16 countries. When it comes to details in negotiations like product inclusion, services, how many rules of origin, and other rules on government procurement, competition, e-commerce SMEs, so many discussions are taking place,” he said.

“There are different sets of targets or ambitions as to the level of liberalization. Some are prepared to give more, some are less prepared to give more. That’s where the problem is,” he said.

So far, Lopez said seven out of the 18 chapters of RCEP have been concluded. The bulk of the remaining chapters on trade in goods and services is the subject of the present negotiations.

He said negotiating parties have been asked to be “more realistic, pragmatic” and recognize the different limitations of the participating countries.

“In the end, it is really in the recognizing the different levels of development and preparedness and some prepared to give more, some less to give more,” he said.

Citing an example, he said the Philippines presented its best case but cannot give more sectors or industries due to the limitations of the 1987 Constitution.   “They are already limited or restricted by Constitution and we cannot change our Constitution overnight so we are telling them this is it. Do not ask for more,” he said.

As they mapped out the different levels of acceptance of participating countries, he said they have reached “many green lights” and a “couple of orange lights” in the RCEP negotiations.

“In other words, not yet settled that will have to be settled because sometimes it needs country-to-country discussions,” he said.