THE Department of Trade and Industry (DTI) said it looks forward to the ratification of the Regional Comprehensive Economic Partnership (RCEP) as this will enhance the participation of small businesses in global value chains.
In a statement on Tuesday, Trade Secretary Ramon Lopez said the mega trade deal will strengthen the micro, small and medium enterprises’ (MSMEs) access to global markets.
“One big advantage of the RCEP Agreement is the wider cumulation area for raw materials. This means our MSMEs can source inputs from the 15 RCEP Parties, process the products here in the country, and export the same to the region at a preferential arrangement,” Lopez explained.
One of the biggest avenues for economic cooperation, RCEP was signed by 10 Association of Southeast Asian Nation (Asean) member-states and five Asean FTA partners in November last year : Australia, China, Japan, Korea and New Zealand.
The RCEP region accounts for 29 percent or $25.8 trillion of the global gross domestic product, 30 percent of the world’s population and 25 percent ($12.7 trillion) of global trade in goods and services, DTI noted.
“The RCEP region accounts [for] around 50 percent of Philippine exports and 68 percent of Philippine import sources. Hence, the country cannot afford not to be part of this free trade area,” Lopez shared.
Lopez said that implementing a uniform set of simplified rules through trade deals will both allow facilitation of trade transactions and reduction of administrative costs for exporters.
As such, the trade chief said this can encourage more production and manufacturing activities in the country, resulting in more jobs and business opportunities.
Trade Asst. Secretary Allan B. Gepty, the country’s RCEP Lead Negotiator, added that the local industry will benefit from having an economy which is open to trade and investment under a rules-based system.
“The RCEP Agreement is a testament [to] the need to further open the markets for trade and investments, and improve rules and disciplines in addressing the evolving business environment such as e-commerce, intellectual property, and competition policies,” he said.
“If you further strengthen the region with rules and disciplines, then you create an environment of trust, and this will encourage more investments and deeper economic integration. In addition, the creation of the RCEP free trade area strengthens economic integration in the region, and balances global power and influence especially with the growing trend in protectionism,” he added.
The trade deal is targeted for implementation by January next year.