In restarting FTA talks, the East Asian neighbours will be building on existing trade pacts to try to deliver one that signals their strongest economic bonds yet, experts note.
China and South Korea have an FTA signed in 2015.
All three countries are members of the Regional Comprehensive Economic Partnership, which took effect in 2022. The RCEP is an FTA among the 10 member states of the Association of Southeast Asian Nations (ASEAN), Australia, China, Japan, South Korea and New Zealand.
A China-Japan-South Korea FTA will be recognised as “RCEP Plus”, going beyond the RCEP’s level of liberalisation.
For instance, the three countries will aim to fully abolish tariffs on automobiles and auto components, which the RCEP did not, reported news agency Nikkei Asia.
Japan will also seek reductions in industrial subsidies and less preferential treatment for state-owned enterprises, which were left out of the RCEP, Nikkei Asia reported.
Commitments by the three countries to each other under RCEP are “relatively thin”, noted Dr Deborah Elms, head of trade policy at the Hinrich Foundation in Singapore. The foundation works to advance sustainable global trade through research and education.
A three-way FTA will allow them to be more focused, she said. “If there’re only three of you in the partnership, you can tailor an agreement often in ways that are more ambitious in some areas, than if you’re trying to do it with (15 parties).”
From: channelnewsasia
Business News
