Picture: 123RF/VIOOREL
Picture: 123RF/VIOOREL

Tokyo — Asian trade ministers have taken another step towards what could be the world’s biggest trading bloc, expressing hope that a deal could be signed by the end of 2018.

Ministers from the 16-nation Regional Comprehensive Economic Partnership (RCEP), which includes China, Japan and India but not the US, met in Tokyo on Sunday to thrash out remaining differences.

"The path towards a year-end agreement is now clearer," said Hiroshige Seko, Japan’s trade minister at a media conference on Sunday. "As protectionism concerns increase globally, it’s important that the Asian region flies the flag of free trade."

If fully achieved, the partnership would also include the 10 members of the Association of Southeast Asian Nations as well as South Korea, Australia and New Zealand, covering one-third of the world’s economy and almost half its population.

While the agreement does not seek to impose higher standards in areas such as labour and environmental protection, like the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership (TPP) signed earlier in 2018, consensus is proving elusive.

Major obstacles include India’s call that any agreement to reduce tariffs on goods and services should allow for free movement of people, something India wants for its highly skilled information technology sector.

"There are great challenges to the global trading system, " said Chan Chun Sing, Singapore’s trade minister. "It serves as added impetus for us to try and achieve a substantive conclusion to the RCEP process."

Any further progress on RCEP could put pressure on the US to consider rejoining the TPP, as the US-China trade war continues. US President Donald Trump’s tariffs on $34bn of Chinese goods are set to kick in on July 6. China has vowed to retaliate against this.

Bloomberg