Out-Law News | 30 Apr 2021 | 11:56 am | 1 min. read
Japan’s upper chamber of the National Diet has approved the Regional Comprehensive Economic Partnership (RCEP) free trade deal.
The deal will be Japan’s first economic partnership deal that involves China and South Korea, according to Japan Times. It is reported that the pact is expected to increase Japan’s gross domestic product (GDP) by 2.7% and create 570,000 jobs.
The agreement will be effective 60 days after it has been approved by six ASEAN member countries and three ASEAN FTA partners.
Trade expert Dr Totis Kotsonis of Pinsent Masons, the law firm behind Out-Law, said: “This is yet another important milestone in the full ratification and entry into force of the RCEP, the largest trade deal in the world. Japan will exert important economic benefits from the deal, not least at a time when prolonged negotiations for a trilateral trade agreement with China and South Korea have yet to reach a successful conclusion.”
“The country has a pivotal role to play in Asian regional economic integration, being the largest economy that is part of both the RCEP as well as the Trans-Pacific Partnership (TPP). In fact, with China expressing an interesting in joining the TPP, the expectation is that in due course the two overlapping trading blocs will combine, strengthening further Asia’s role in global trade,” he said.
China's commerce ministry said that all RCEP signatories have expressed their intentions to complete the ratification process within the year in order to have it entre into force on 1 January 2022.
15 Asia Pacific countries in November 2020 signed the RCEP trade deal, which will cover about 30% of the global GDP, and trade tariffs will be removed for 91% of products.