The signing of the Regional Comprehensive Economic Partnership (RCEP) in November 2020 was a historic event, marking the formalization of the world’s largest trading bloc by GDP size. RCEP is also the second mega trade deal for the Asia Pacific region, after the signing of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Even as the Covid-19 pandemic remained a sobering reality, RCEP signatories greeted the agreement with excitement.
Now, the wait. RCEP will only function when it comes into force with a minimum of nine member countries (six from ASEAN members and three from non-ASEAN economies) ratifying the agreement. Given the uncertainty surrounding Covid-19 variants and political instability in the region, the free trade agreement (FTA) may not come into force until 2022.
That gives RCEP members time to reflect on the potential of the FTA and its role in the future economy.