Beijing Daily Client
The Regional Comprehensive Economic Partnership Agreement (hereinafter referred to as RCEP) is the main platform and source of power for Asia-Pacific regional integration. It is also an important lever for China to build a new domestic and international dual-circulation development pattern. Since its launch in January 2022, RCEP has successively entered into force for 13 of the 15 signatory countries, effectively reducing economic and trade barriers within the Asia-Pacific region, and further stimulating and expanding China's internal and external circulation. With the effective promotion of RCEP, the Asia-Pacific region is gradually becoming the hub of China's "dual circulation".
Maintain the safety and stability of the industrial chain and smooth the domestic circulation
Under the complex situation of intensified strategic competition between major powers, the delay of the new crown epidemic and the Ukrainian crisis , global industrial and supply chains are frequently blocked, broken or reshaped, which has a negative impact on the industries of various countries. The serious impact on security and stability has also put forward more urgent requirements for countries to ensure domestic production and promote industrial upgrading. In this context, the significance of RCEP in consolidating and optimizing regional industrial and supply chains has become even more prominent. For China, RCEP is an important barrier against risks in the global industrial and supply chains, and the security and stability of the industrial and supply chains is also a basic prerequisite for a smooth domestic circulation.
On the one hand, the supply of intermediate products from RCEP partner countries ensures the stable operation of China's industrial chain. Among RCEP members, Japan and South Korea have long been the main sources of imports of manufacturing parts for China. Thanks to the gradual implementation of RCEP’s provisions on tariff reduction and investment facilitation, China’s cost of obtaining parts and components from these countries has continued to decline and its efficiency has improved. This has actually enabled RCEP partner countries’ intermediate product suppliers to become more closely embedded. China’s industrial chain system. This not only enhances the resilience of China's industrial and supply chains, but also relieves the huge pressure China faces in promoting localization of all industrial chain links.
On the other hand, RCEP forces China to make up for the shortcomings in the industrial chain and continue to promote industrial upgrading. The State Council executive meeting held in December 2021 pointed out that enterprises should be supported to seize the opportunity of RCEP implementation, enhance their competitiveness in participating in the international market, further improve the level of trade and investment development, and force domestic industries to upgrade. With the entry into force of RCEP, the degree of collaboration between Chinese companies and companies from other member countries in terms of technology research and development, production and manufacturing is increasingly deepening, which will help to discover the shortcomings and weaknesses of their own industrial chains as early as possible, and at the same time make up for them in a timely manner with the help of partners. , and on this basis, enhance the competitiveness of Chinese enterprises in the upstream of the industrial chain.
Improve the level of opening up to the outside world and expand the international circulation
Compared with most other regional free trade agreements , RCEP is characterized by wide coverage, large economic and trade scale, and high level of rules. Participating in RCEP is an important step towards China's high-level opening up, which requires China to recognize and abide by higher-level international economic and trade rules, open its domestic market to more countries, and withstand more direct competitive pressure from companies in partner countries. This also provides key assistance for China to expand the international cycle.
This is the China-Thailand cross-border container being reloaded at the reloading yard of the Vientiane South Station of the China-Laos Railway in Vientiane, Laos, on July 1. The loading yard at the Vientiane South Station of the China-Laos Railway was officially completed and put into use on the 1st. The first batch of cross-border containers were transferred between standard gauge and meter gauge and shipped to Thailand. This marks the realization of interconnection between the China-Laos-Thailand railway and a more convenient and smooth international land-sea combined logistics channel. Xinhua News Agency (Photo by Kai Qiao)
First, RCEP has effectively expanded trade between China and other member states. According to RCEP's arrangements for trade liberalization , more than 90% of goods trade between member countries will be reduced to zero tariffs immediately after the agreement comes into effect or will be gradually reduced to zero tariffs within 10 years. This has greatly enhanced the impetus for import and export trade among member countries. In recent years, the volume of goods trade between China and RCEP partners has accounted for approximately 30% of China's total foreign trade in goods. Among them, ASEAN has surpassed the EU and the United States to become China's largest trading partner since 2020. On this basis, in the first half of 2022, the trade volume between China and RCEP partner countries increased by 5.6% year-on-year, with the largest increase in import and export volume to ASEAN, which was approximately 10.6%.Against the background that the epidemic has caused great obstacles to transportation and production, the trade volume between China and RCEP partner countries has still been able to grow steadily, which further proves that RCEP has strong momentum in expanding opening up.
Second, RCEP promotes Chinese enterprises to "go global" in a more flexible and diversified way. RCEP stipulates that member countries adopt a negative list approach in the investment field. This is also the first time that China has committed to opening up to foreign investment in a negative list approach when participating in a free trade agreement. In addition, RCEP implements the principle of accumulation of origin, which actually reduces the value-added threshold concerns of multinational enterprises when selecting investment locations. Driven by relevant rules, two-way investment between China and RCEP partner countries, especially China's investment in RCEP partner countries, remains dynamic. According to data released by the Ministry of Commerce, from January to May 2022, China’s foreign direct investment flows were approximately US$44.6 billion, a year-on-year increase of 3%. Among them, RCEP member countries such as Singapore and Indonesia are still the main target countries for China’s foreign investment. . Not only that, China also continues to expand investment and construction of infrastructure in relevant countries. A number of infrastructure projects such as the Jurong Island energy storage EPC project in Singapore and the Upper Sisokkan pumped storage power station construction project in Indonesia were all confirmed to be carried out by Chinese companies in the first half of the year. Undertake construction.
Overall, RCEP helps China build a new domestic and international dual-circulation development pattern, and also promotes the Asia-Pacific region, especially ASEAN, to become a "dual-circulation" hub. From the perspective of ensuring the security and stability of industrial and supply chains, the Asia-Pacific region can be said to be an extension of China’s domestic cycle; and from the perspective of promoting high-level opening up, the region has become, to a certain extent, an important part of China’s participation in the international cycle. Proving ground and starting point.
(Luo Yifu, Assistant Researcher, Institute of World Economics and Politics, Chinese Academy of Social Sciences)
