RCEP still finding it hard to wrap up FTA

Crunch time: Mustapa briefing the media on the country’s trade and investment climate.

KUALA LUMPUR: After four years of negotiations, the 16 countries in the Regional Comprehensive Economic Partnership are still having difficulties to bridge the gap to wrap up the Asean-led free trade deal.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed admitted it was challenging and hoped negotiations can be wrapped up by the end of next year.

The 16 countries – Asean 10 and its six dialogue partners –Japan, India, China, New Zealand, Australia and South Korea –missed the deadline twice in 2015 and this year.

At the Asean Summit in Laos in September, the ministers and officials were given another year to conclude their negotiations by 2017.

Mustapa said among the 20 chapters in the FTA, goods and services, competition and intellectual property were the issues that were tough to iron out.

“Leaders are always ambitious, this is the target set by them and it is good that they put pressure on us. I must say there are many challenges. Yes, there is progress but the gap is still big between Asean and their six partners.

“Some countries involved in the Trans Pacific Partnership want RCEP ambitions to be close to TPPA.

“The ministers want RCEP to be in between Asean plus 1 and TPPA.

“We want RCEP to be better than Asean plus 1 and we want to raise the level of ambition.

“Some countries are thinking there is no point having one if it is the same level as Asean plus 1,” he told the media yesterday.

With the TPPA’s fate now hanging in the balance after US President-elect Donald Trump threatened to pull the US out from the deal, officials are under a lot of pressure to wrap the RCEP up.

Formally launched in 2012, RCEP is aimed at consolidating the FTAs between Asean and its dialogue partners to ease trade procedures and boost the flow of trade and investment within the Asia Pacific region.

The 16 economies’ combined output stood at US$22.7tril (RM99.7tril) in 2014, representing 28% of the world trade.

Mustapa stressed that while all 16 countries were committed to RCEP, some of the issues agreed upon at the ministerial level were not translated when it came down to the official level.

So far officials have held 16 rounds of negotiations with the last one in Indonesia two weeks ago.

They are expected to meet again in Japan next February.

Mustapa also said the Cabinet in its meeting yesterday had given the go-ahead to Miti to hold negotiations for an FTA with Iran.