RCEP services

RCEP: Still a Work in Progress

RCEP:  Still a Work in Progress

This was supposed to be the year that the Regional Comprehensive Economic Partnership (RCEP) trade negotiations finally wrapped up.  Once again, it will not happen. The 16 parties involved (Australia, Brunei, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, Philippines, Singapore, South Korea, Thailand, and Vietnam) have been talking since early 2013.  After 24 formal rounds, at least 9 ministerials, multiple informal meetings, and annual leader’s meetings, RCEP remains a work in progress. Why is it taking so long to get an agreement? The short answer is two-fold—a lack of sufficient political will and serious technical challenges in bridging the gaps between widely different member states.  The lack of political will seems surprising to many outsiders.  After all, at a time of rising global trade tensions, surely this is the best time to lock down an agreement in Asia to keep trade lanes open for mostly export-dependent trading states? 

RCEP and Digital Services

Larger regional agreements, like RCEP, provide the size and scale in an agreement that can unleash new growth prospects.  To get there, however, requires officials, ministers and leaders to seize the chance and create something special.  RCEP has to address barriers to trade in services, for example.  Services are critically important to the economy of the future.  Even trade in goods requires that services be considered, since blockages on the movement of services across borders can fundamentally impede the growth of trade in physical products like manufactured goods and agricultural items.  Increasingly, services will be provided digitally.  One such example is the rise of online travel agencies (OTAs.)  These service providers represent a new dimension to travel and tourism, as they match up customers seeking things like accommodation, rental cars, or local experiences like cooking classes or photography tours with local providers and vendors of such services.