Colombo aims to be South Asia's first nation to join RCEP
The island wants to join the world's largest free trade and economic cooperation agreement. The announcement by President Ranil Wickremesinghe, who also wants to 'demilitarise' the Indian Ocean. For analysts and experts, it is an important step to revive the country's economy and open up new avenues for growth and development.
Colombo (AsiaNews) - Colombo aims to become the first South Asian country to join the Regional Comprehensive Economic Partnership (RCEP), the largest free trade and economic cooperation agreement in the world, following the conclusion of the initiatives to optimize the credit, announced by President Ranil Wickremesinghe, during a speech marking the 56th anniversary of ASEAN - an association that brings together 10 nations of South-East Asia - which was held on 8 August in the capital of Sri Lanka .
"We must join the RCEP" and "there is no reason" not to do so underlined the head of state, adding that trade agreements with India and Bangladesh are necessary for the development of the nation. And at the same time he hopes for the "demilitarization" of the Indian Ocean, aligning itself with the objectives already set by ASEAN.
Signed after eight years of negotiations on November 20, 2020, the RCEP involves the 10 ASEAN nations - Brunei, Cambodia, Philippines, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, Vietnam - China, South Korea, Japan, Australia and New Zeeland.
The an area represents at least 2.3 billion people (equal to 30% of the global population) and boasting a GDP (Gross Domestic Product) of .3 trillion in 2022, approximately 29% of global GDP.
Sri Lanka wants to enter the Free Trade Agreements (FTA) and start free trade negotiations with ASEAN, not before having concluded the agreement with external creditors relating to the over 40 billion dollars needed to meet the requests of the Monetary Fund international (IMF).
The island's leaders believe these are necessary steps to rebuild a nation hit by the worst economic and social crisis since independence and increase its foreign currency reserves.
Interviewed by AsiaNews, the economist Harin Wijesinghe underlines that "among the advantages of the RCEP are the reduction of trade barriers, including tariff concessions by trading partners".
Moreover, the "improvement of market access, economic and technical cooperation, small and medium-sized enterprises and the streamlining of customs procedures". Membership "will facilitate market access for exports of agricultural products, as partner countries have agreed to reduce customs tariffs".
The deal involves ASEAN nations and free trade partners (FTA) and aims to cover trade in goods and services, including intellectual property. Furthermore, it would open "to foreign investors - concludes the expert - at least 65% of the service sectors such as telecommunications, finance, distribution and logistics".
Colombo has already entered into a trade agreement with Singapore and is also actively negotiating with Thailand. The nation has immense potential as a trading hub in the Indian Ocean and is rapidly rising as a gateway to South Asia.
Economists Chandima Tennakoon and Anuruddha Senanayaka are of the opinion that “the RCEP will create new commercial opportunities between Asian countries and accelerate the economic recovery of the region.
The agreement will also eliminate tariffs on more than 90% of goods over the next 10-15 years and introduce investment and intellectual property rules to promote free trade.
Academic and analyst Ruwan Kariyawasam believes that "President Wickremesinghe's statement on membership" underscores "Sri Lanka's determination to strengthen its economic connectivity within the wider Asian region". This also includes its alignment with ASEAN's future vision for the Indo-Pacific region.
"These partnership proposals - he concludes - highlight the commitment to promote economic cooperation and trade links, which will open new paths for growth and development".
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16/11/2020 13:50
24/01/2007
