The RCEP (Regional Comprehensive Economic Partnership) is the World’s Largest free trade agreement covering 15 states. These 15 states cover over 2 billion people and some of the world’s most highly integrated nations in the global economy, responsible for about 1/3 of the world’s economic output. Negotiations started in 2013, lasting 31 rounds till the deal was formally signed on the 15th of November 2021. The primary aim of the RCEP was to simplify the so-called ‘Noodle bowl’ of overlapping and inconsistent trade agreements in East Asia, enabling firms to build a supply chain across the region. In the past, ASEAN +1 agreements had been the leading trade agreement in Asia, but they were limited, particularly on issues like trade in services and investment. The RCEP aims to be more comprehensive. Its Guiding Principles document states that it will cover ‘trade in services, investment, economic and technical cooperation, intellectual property, competition, dispute settlement, and other issues.
The RCEP is Chinas first multilateral free trade agreement, and as can be seen from this graph, it is set to realise the most gain of any states parties. These projections from the Asian Development Bank show that trade-related economic gains are situated in East Asia with China, Japan and South Korea. Existing agreements like ASEAN + 1 cover 82 % of RCEP trade. However, this is the first FTA agreement involving Japan, South Korea and China. ASEAN is already well integrated, with 70% of internal ASEAN trade occurring without tariffs. Even though ASEAN states will not benefit as much as East Asia, the RCEP embodies the ASEAN idea of ‘Omni-enmeshment’; pulling in major powers and balancing their influence. The RCEP will also address some of the weaknesses of the ASEAN +1 trade agreements. Namely the fact they focus heavily on trade in goods without too much emphasis on services.