China won't dominate RCEP trade deal – DTI

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Metro Manila (CNN Philippines, November 27) — The newly-formed Regional Comprehensive Economic Partnership or RCEP deal will not be dominated by China, the Department of Trade and Industry said amid doubts about the world's biggest trading bloc.

DTI Assistant Secretary Allan Gepty said Friday that while China may be an economic powerhouse in Asia, it will have to follow the same set of rules agreed upon by the 15 states who signed the agreement.

"RCEP is not China-led... it was ASEAN who initiated this largest free trade agreement," Gepty said in a virtual Malacañang press conference on Friday, referring to the 10-member Association of Southeast Asian Nations that includes the Philippines.

"On the question of whether or not China can dominate the RCEP region, I think that is more apparent than real because of that notion that China is the big economy," he added.

The deal is touted to make it easier for member-states ­-- including the Philippines and China -- to import and export across the region. The other ASEAN parties are Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam. Neighboring Australia, Japan, South Korea and New Zealand also joined the free trade arrangement, which was inked during the virtual summit of the Association of Southeast Asian Nations on November 15.

"Meron tayo ditong [We have a] competition chapter, it guarantees that our investors, our service providers in the RCEP region will be treated equally," Gepty added. "We conduct business, we conduct trade on the basis of rules, not because one is powerful –– or let's say, politically or economically dominant."

Gepty said the deal trims tariffs on 98.1% of goods across the region, and stands to complement and widen the scope of existing bilateral trade arrangements.

Filipino businesses will have easier access to raw materials and intermediate goods with relaxed trade barriers, while locally-made products will be easier to export to a market of 2.3 billion people.

The DTI official said the manufacturing, construction, machineries, and agriculture sectors have the most to gain from cheaper input materials, while electronics and electrical products – the country's main export items – will also enjoy a lift.

Meanwhile, he assured local farmers that they will not be disadvantaged as Asia-Pacific further frees up trade in crops.

Gepty said the Rice Tariffication Law, which collects a minimum 35% tariff on rice imports, will remain intact despite the RCEP liberalization.