TWO important decisions at the recently concluded 21st Asean Summit in Phnom Penh were: the launch of the Asean Regional Comprehensive Economic Partnership (RCEP) and delaying the launch of the Asean Economic Community (AEC) by 12 months, from Jan 1 to Dec 31, 2015, to iron out pending issues and prepare the necessary regulations.
RCEP is forged as an alliance between Asean and its six dialogue partners - Australia, China, India, South Korea, Japan and New Zealand — to create a free trade area with great potential for gains through economic cooperation.
To date, numerous free trade agreements (FTAs) and economic partnership agreements (EPAs) have been concluded between single Asean member nations and by Asean as a group with individual dialogue partners.
However, the overlapping priorities, procedures and practices have reduced the effectiveness and the potential benefits of these agreements since businesses have to observe the different rules of these various arrangements while it has also increased the cost of utilising preferential concessions.
It is in that context that the Asean RCEP agreement, with its region-wide partners, has the potential to reduce the complexity arising from the current multiplicity of agreements by agreeing on a single package and focusing on Asean's centrality in the region.
Second, RCEP would be a basis for more complementary regional integration initiatives, since the partnership is to be built on the experiences, strengths and drawbacks of the many existing FTAs and EPAs.
It is also hoped that the Asean RCEP could spur efforts to set up an FTA between China, Japan and South Korea, a prospect faced with several impediments still to be resolved.
Once established on a firm footing among the three northeast Asian nations, it can certainly enhance further regional economic integration.
All these positive aspirations and moves to achieve effective regional economic integration pivot on the countries concerned strengthening their commitment to, and being ready to work towards, that very goal, both among Asean members and their dialogue partners.
And, it is here, that the decision to delay by 12 months the launching of the AEC becomes critical. In that time frame, all Asean members must make progress to fulfil and implement the agreed road map and targeted actions for the AEC.
That must surely be a prerequisite for realising the broader goal of regional economic integration.
One should also keep in mind that RCEP might be perceived as a competitor to the United States-led Trans-Pacific Partnership (TPP). At present, only Australia, Brunei, Malaysia, New Zealand, Singapore and Vietnam are a part of the TPP, while several other Asean members and dialogue partners, notably China, are not — a fact that could cause conflict of interests and derail effective economic integration.
Such a situation, if not clearly demarcated so that both the TPP and RCEP mutually benefit its members, could easily complicate further the existing and planned business pacts in the region, and frustrate efforts to achieve effective regional economic integration.
Malaysia, as a founding Asean member, having successful economic ties with all major countries and given its presence in both the TPP and RCEP, can and should play a key role in helping to promote the success of the AEC and the wider goal of regional economic integration, especially in the current context of a globalised economic and trading regime.
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