Initiated by ASEAN in response to the US-led Trans Pacific Partnership, it is, in part, designed to leverage more value out of the existing five ASEAN free trade agreements with other RCEP countries and the plethora of bilateral FTAs negotiated over the past 15 years among the RCEP countries themselves. But RCEP has the potential to be much more than simply another mega-regional free trade agreement.
While the Asian economies are already highly integrated, it is an interdependence which has grown under the current global trading regime, not through bilateral or regional trading arrangements. Staggeringly, ASEAN, Japan, China, Korea, India, Australia and New Zealand – which comprise the RCEP group – already had a bigger share of global GDP measured in real terms than the TPP countries in 2007. Bluntly put, the RCEP group is where the global economic dynamism is, and it is a massive opportunity for Australia and for the region.