Quan-Ding Liu

The Regional Comprehensive Economic Partnership （RCEP） was launched by 10 ASEAN countries[1] in 2012, inviting China, Japan, South Korea, Australia, New Zealand and India to join in （" 10+6 "）, aiming to establish a 16-country FTA consisting of a single market by reducing tariff and non-tariff barriers. RCEP members are committed to opening their markets to each other and implementing regional economic integration. If RCEP is signed successfully, it will cover about 3.5 billion people, nearly half of the world's population, with a combined GDP of us $23 trillion, accounting for one-third of the global total. The RECP will become the largest FTA in the world in terms of population, economic aggregate and geographical area.

Due to the large number of countries involved, different levels of development and different interests and concerns, RCEP negotiations have been very difficult. Starting in 2012, after five years of preliminary negotiations, RCEP negotiations began to accelerate in 2017. By the end of 2017, the 16 countries had completed seven chapters of the consultation, raising the completion rate of the negotiation task to nearly 80%. The parties have also made breakthroughs in some of the more controversial basic rule chapters. Since the trade war broke out in 2018, China has stepped up efforts to advance negotiations. At the leaders' meetings on East Asia cooperation held in Singapore on 14 November 2018, Chinese Premier Li Keqiang called on all parties to make persistent efforts, maintain the positive momentum and deliver a "decisive kick" as the negotiations enter a critical period.[2] To actively promote the negotiations, Chinese Premier Li Keqiang also met with Canadian Prime Minister Justin Trudeau, Singapore President Halima, Australian Prime Minister Morrison and New Zealand Prime Minister Ardern respectively at the meeting. It is noteworthy that US President Trump is absent from the summit. On the contrary, Russian President Vladimir Putin not only actively participated in the summit, but also held meetings with Rok President Moon Jae-in, Japanese Prime Minister Shinzo Abe and other national leaders respectively, creating a favorable atmosphere for the RCEP's advancement. Driven by the efforts of China, Japan and the ROK, the third RCEP Leaders' Meeting held in Bangkok, Thailand, on November 4, 2019, issued a leaders' statement, stating that "15 of the RCEP members have concluded negotiations and initiated the review of the legal text, and expect to sign the agreement in 2020".[3] "The RCEP will greatly contribute to the region's future economic growth prospects and contribute positively to the global economy. It will also serve as a strong support for the multilateral trading system and promote regional economic development," the joint statement said."RCEP will provide an important boost to the regional economy at a time of increased turbulence and slowing global trade and economic growth," Said New Zealand Prime Minister Ardern. At present, unilateralism continues to spread and trade and investment disputes, represented by the trade war between China and the US, are emerging. In particular, the global coVID-19 pandemic since 2020 has increased the downward pressure on the global economy. As a whole, the 15 RCEP member countries that have concluded negotiations have a population of 2.2 billion, A GDP of 29 trillion US dollars, an export volume of 5.6 trillion US dollars, and foreign investment of 370 billion US dollars. These indicators account for roughly 30% of the global total. Thus, when completed, the RCEP will be the world's largest FTA. The finalization of the RCEP15 agreement is of great significance for the rapid and strong economic recovery of the region and the world at large.

What is noteworthy is India's decision to withdraw from RCEP at the last minute of negotiations（Knitting International,2019）. This may have something to do with India's consideration of its core national interests. The fundamental reason is India's domestic economic and industrial development level, internal political struggle, especially India's positioning of its role as a regional power, which kept India away from RCEP at the last minute. India's withdrawal will have a limited impact on the RCEP. This is because India has a large population, a large market and is attractive to member countries. If India were to leave, it would make the RCEP less attractive to other members. For example, After India expressed its intention to withdraw from the RCEP, Japan has repeatedly said that it cannot do without India, and even does not rule out the possibility that Japan will eventually choose to abandon the RCEP. In essence, "10+6" is undoubtedly the most ideal RCEP. But economically, even if it became the 10+5, it would still be bigger than NAFTA and the European Union combined. It is still of great significance for Japan, as FTA coverage in Japan's trade will greatly exceed the 70% target set by the Japanese government. Therefore, even if India withdraws, it is significant for RCEP to be signed and implemented in the form of "10+5" （Yushuan Cheng Yung, 2020）.

This paper focuses on the development prospect of RCEP and its significance to the implementation of FTA strategy in China. As mentioned above, China-ASEAN FTA is the earliest FTA signed between China and Macao except Hong Kong and Macao. Moreover, of the RCEP's 15 current participants, China has signed bilateral FTAs with South Korea, Singapore, Australia and New Zealand. All these experiences have helped China to adapt to and play an important role in the RCEP. In terms of economic size, as shown in FIGURE IV-1, China's GDP accounted for 59% of the total GDP of the 15 countries in RCEP in 2019, which determines that China is bound to play a very important role in RCEP. After the trade war between China and the US, In 2018 alone, China's exports to the remaining 14 RCEP countries totaled us $620 billion, and its imports totaled US $760 billion, accounting for about one third of China's total trade volume. In the same year, China invested us $16 billion in 14 countries and attracted US $14 billion of foreign investment from within the region. All this is of great significance to the development of healthy, sustainable and stable foreign trade and investment relations. For Chinese consumers and those enterprises that depend on imported raw materials and spare parts from Southeast Asia, the cost of trade will be greatly reduced and all parties will benefit from the removal of tariff and non-tariff barriers on RCEP.

In terms of content and trade rules, the RCEP is one of the more comprehensive, high-quality and mutually beneficial FTAs in the world. There are altogether 20 chapters on the RCEP, including the basic features of the FTA, trade in goods and services, access to investment and relevant rules. It is also a highly modernized FTA. RCEP covers e-commerce, intellectual property rights, competition policy, government procurement, SMES and other very modern contents. What is of particular concern is that, in terms of trade access rules, among the 15 RCEP member countries, there are both developed and developing countries, as well as many emerging economies. The level of economic development varies greatly. In addition, cultural background and political system are also very different. The agreement of 15 economies with strong cultural diversity and institutional diversity will be important and far-reaching for the future formulation of global economic and trade rules. In terms of trade in goods, the level of openness will reach over 90%, higher than that of WTO countries. In terms of investment, negative list is used for investment access negotiation （Wang Su, 2020）.  As the world's largest FTA, the smooth signing of the RCEP will help boost investor confidence and public confidence in the world economy. Investors from outside the RCEP now have to deal with a variety of rules when entering the region. But in the future, they only need to face a set of uniform regional rules, which means greater market potential and development space. The uniform rules will greatly help regional business communities and import and export companies to reduce operating costs and various risks of business operations. The construction of regional supply chains and value chains will also create new opportunities. As these chains develop in line with regional comparative advantages, the flow of goods, technology, services, capital and people across borders will be more convenient. Within the region, all enterprises can participate in the accumulation of value of origin, which will help promote mutual investment and trade within the region （Lan Xinzhen, 2019）.

With China's economy hit by the trade war, economic globalization stalled, and the global economy in recession caused by COVID-19, regional economic integration is bound to usher in new development opportunities. RCEP is expected to be the "breakthrough point" for East Asia to emerge from the crisis （Lin Han, 2019）. The RCEP process is giving Asia the chance to show how cooperation should be promoted, and the multilateral order developed, at the global level. This might help to prevent conflict between the rising superpower, China, and the previous hegemony, the United States（David Wines，2019）.  As the largest and most important FTA in the Asia-Pacific region, RCEP is China's strategic choice to actively promote FTA strategy, participate in global economic governance and enhance the voice of rules and regulations. China also plays an important role in promoting the RCEP and upholding the multilateral trading system. The basic RCEP agreement means that China has preliminarily reached the goal of accelerating the development of the FTA, which further expands the unfavorable circle of friends of China's FTA. From the point of China's domestic economic system and market rules, RCEP relating to market access and related trade and investment rules, it will be reversed transmission of China's domestic economic system and market reform, to create a more good business environment, enhance the level of Chinese trade and investment liberalization and facilitation and overall help China to build an open market economy. From the perspective of the overall economic situation in East Asia, although the economic integration of various countries is relatively high, from the perspective of the existing industrial chain, the region as a whole still depends on the developed western countries. Once signed, the RCEP will, first and foremost, facilitate China's industrial upgrading and accelerate the transformation of the Chinese economy into a high-level and innovative economy.

China has a comprehensive and experienced industrial base, and its scientific research capacity has been rapidly improving in recent years. A large number of researchers will help countries in the region to establish industrial chains, reshape value chains and further improve the integration of regional economies, so as to bring greater economic dividends to all countries. In addition, China has a vast domestic market and a large consumer group, which provides greater business opportunities for countries in the region. In particular, China's growing middle class has become the largest consumer group in the global consumer market. China has a well-developed infrastructure and transportation network, and a stable society. With the deepening of the "One Belt And One Road" construction, the connectivity with countries along the belt and road is more convenient, and the circulation of goods and materials within the region is faster, laying a foundation for the formation of the largest single market in the world. For regional economic integration. RCEP can not only stimulate intra-regional trade, boost economic confidence, invigorate regional economy and inject vitality into the world economy, but also have a strong demonstration effect and lay an important foundation for the establishment of an Asian Economic Community （Liu Yantang, 2019）. It is worth mentioning that the RCEP negotiations are still dominated by traditional issues. For example, it stipulates that the level of tariff exemption should reach at least 95%, which is much higher than the level of openness of WTO members. However, many emerging issues have been added to the RCEP negotiating text, which now covers 18 areas, including trade in goods, trade in services, financial services and telecommunications services. On investment, in particular, the RCEP has initiated negotiations on investment access by launching the negative list system. It reflects the positive actions in docking high-quality international trade rules, which is conducive to substantially reducing market barriers within the region, improving the business environment, and promoting the efficient and convenient flow of factors within the region （Zhang Monan, 2019）.

[1] The Association of Southeast Asian Nations (ASEAN) was established on August 8, 1967 in Bangkok, Thailand. It has ten members: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, The Philippines, Singapore, Thailand and Vietnam.With a total area of about 4.49 million square kilometers and a population of 654 million (as of 2018).The secretariat is located in Jakarta, the capital of Indonesia.

[2]  Source: 环球时报，2018.11.15，李克强:RCEP谈判已进入关键时期，要踢好“临门一脚”

[3] 《区域全面经济伙伴关系协定》（RCEP）第三次领导人会议联合声明，China FTA Network,  2019-11-05, http://FTA.mofcom.gov.cn/index.shtml

(Quan-Ding Liu is associated with Office of International Cooperation and Exchange, Baoji University of Arts and Sciences, China )