Editorial : Participate in the Economic Integration of East Asia

【明報專訊】While globalisation has run into a headwind in the West, East Asia and Oceania have taken an important step towards regional economic integration. 15 countries, which comprise the 10 ASEAN nations and China, Japan, South Korea, Australia and New Zealand, have recently signed the Regional Comprehensive Economic Partnership Agreement (RCEP), marking the formal conclusion of the world's largest free trade agreement. Multilateral free trade co-operation is an irreversible trend even though the US has turned its back on it, and China's integration into the global market and the deepening of its openness will not be halted because of Washington's diplomatic containment. The RCEP, which includes the major countries of East Asia and Oceania, represents non-Western economic globalisation and will accelerate the formation of an East Asian economic sphere. As an important logistic and financial centre in the region, Hong Kong should actively seek to join the RCEP and seize the opportunities of East Asia's economic integration.

The RCEP accounts for around one-third of the global population and around 30% of the world's GDP. The agreement is aimed at minimising trade barriers and lowering the threshold of market entry. The goal is to reduce customs duties to zero in ten years, open services and trade in the region and promote investments, freight transportation and the movement of people.

The RCEP does not include the US, and India withdrew from the negotiations last year for fear of an influx of China's products after lowering the tariffs, which would hurt local industries. Not only is China an important promoter of the RCEP, but it also accounts for a large proportion of the RCEP's economic size. In the post-pandemic era, the reorganisation of global industrial and supply chains and the economic integration of East Asia will present important opportunities for China. The RCEP will be an important platform for China's push to promote its digital currency and internationalise the RMB. It is a natural development that the agreement will help China expand its influence in the region. However, it must be pointed out that the RCEP does not reflect the mentality of the West that "the strong get to call the shots". The agreement will not force the opening of markets, but will rather focus on mutual consent and seek a win-win situation. The 10 ASEAN countries provide a balancing factor, while Japan and Korea also have an equally important role to play.

The Trump administration has focused its effort on fighting a trade and technology war with China, but it has abandoned the battlefield of multilateral free trade agreement (FTA) rule-setting rights. After Biden takes office, it will not be easy for the US to rejoin the CPTPP even if he wants to given the mood of domestic protectionism in the country. In the first half of this year, ASEAN replaced the EU as China's largest trading partner, and the RCEP marks the first time that China and Japan have reached an agreement on tariff concessions. It has also laid the foundations for China-Japan-South Korea trilateral free trade negotiations. The East Asian economic bloc is gradually becoming self-sustaining and is no longer lopsidedly dependent on the West. This is a major paradigm shift. Although Hong Kong is not a member of the RCEP, it still needs to make early preparations and reflect on its own position and role. As a free port, Hong Kong does not have tariffs on imports. However, by reducing barriers to services and investment, the RCEP is expected to provide more opportunities for Hong Kong to trade more actively in the region and to capitalise on Hong Kong's advantages as a logistic and financial centre.

明報社評2020.11.19:東亞經濟一體化 香港參與勿遲疑





■Glossary 生字

headwind /ˈhedwɪnd/

a wind blowing in the opposite direction to the one you are moving in

logistic /ləˈdʒɪstɪk/

relating to the detailed organisation of an activity

freight /freɪt/

goods transported in bulk by truck, train, ship, or aircraft

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