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On August 30, the Indonesian National Assembly passed a law ratifying the Regional Comprehensive Economic Partnership (RCEP Agreement).
This move makes Southeast Asia's largest economy, the next 14th country on the RCEP agreement, to ratify the RCEP Agreement. It is expected to boost Indonesia's trade and investment.
Coordinating Minister for Economic Affairs Airlangga Hartarto said that the implementation of the free trade agreement between Asia-Pacific countries will help increase Indonesia's gross domestic product (GDP) by zero. 07 percentage points by 2040. At the same time, exports are also expected to increase by US$5 billion and increase the country's trade surplus by 2.5 times.
RCEP offers Indonesia an opportunity for Indonesia to strengthen its integration in the global supply chain, especially in the region. The implementation of the agreement will open up new market access, especially in areas such as horticulture, fisheries, automobiles, electronics, food and beverage, chemicals, and machinery, in countries including China, Japan, and South Korea.
Indonesia's trade with other members of the accounted for 60% of Indonesia's exports and 71% of its imports last year, while they accounted for 47% of foreign investment in the country. Businesses from Singapore, China, Japan, South Korea, and Malaysia are among the largest foreign investors in Indonesia.
The RCEP Agreement builds on existing bilateral agreements that ASEAN has with its main trading partners - China, Japan, South Korea, Australia, and New Zealand, which account for about 30% (26 trillion VND) of Global GDP and 30% of the world population. It is also the first free trade agreement linking China and Japan, as well as Japan and South Korea.
The agreement was signed by the leaders of 15 Asia-Pacific countries in November 2020 and entered into force on January 1, 2022, thereby cutting tariffs on about 92% of goods. transaction. Singapore was the first country to ratify the agreement in April 2021. Followed by five other Southeast Asian partner countries Australia, China, Japan, New Zealand, and South Korea. The Philippines is the only signatory that has not yet ratified the agreement.
The agreement covers areas such as e-commerce, government procurement, intellectual property, and competition policy. Indonesia is aiming for RCEP to come into force in early November. The agreement will come into force for the country 60 days after it has deposited its instrument of ratification. On the same day, the Indonesian parliament also approved a bilateral trade agreement with South Korea, which could help Indonesia boost investment, especially in the electric vehicle and battery industries.
Source: Công Thương News