Determined to explore options to beat the global economic slowdown, the Heads of State/Government of the ASEAN Member States, and ASEAN’s FTA partners, namely: Australia, China, India, Korea, Japan and New Zealand, officially kicked off  negotiations for the Regional Comprehensive Economic Partnership or RCEP.

The move was one of the highlights of the 21st ASEAN Summit and Related Summits in Phnom Penh, Cambodia.

The idea was first mooted at the 19th ASEAN Summit in November 2011, when leaders of the ten ASEAN Member States adopted the ASEAN Framework for Regional Comprehensive Economic Partnership, which sets out the general principles for broadening and deepening ASEAN’s engagement with its FTA Partners. This important milestone signaled the determination and commitment of ASEAN to play the lead and central role in the emerging regional economic architecture.

The significant progress made in ASEAN’s FTAs with China (ACFTA), Japan (AJCEP), Korea (AKFTA), India (AIFTA), and Australia and New Zealand (AANZFTA) has put these trading partners in a position to bring to a higher level their economic partnership by negotiating a comprehensive economic partnership that would lead to the creation of an integrated market that spans 16 countries with a combined market of over 3 billion people and a combined GDP of about US$19.78 trillion based on 2011 figures. The RCEP would be the largest regional trading arrangement to this day.

“With the region accounting for more than half of the global market and about a third of the global economic output, there is no doubt that a successful RCEP would significantly contribute and boost global trade and investment,” said Dr. Surin Pitsuwan, Secretary-General of ASEAN.

The landmark event in Phnom Penh comes at a time when economic recovery efforts continue to be seriously challenged by the volatile global financial and economic situation. With the launch of RCEP negotiations for a modern, comprehensive, high-quality agreement, the RCEP is a strategic move aimed at keeping the momentum of growth in the region by ensuring that markets of the participating countries remain open and competitive.

RCEP negotiations are expected to commence in 2013. Leaders also endorsed the Guiding Principles and Objectives for Negotiating the Regional Comprehensive Economic Partnership, adopted by their Economic Ministers in Siem Reap in August 2012.  Based on the said Guiding Principles, the RCEP – although to be initially negotiated by ASEAN and its existing FTA partners – would allow the region’s economic partners to eventually accede into the agreement. The RCEP is also expected to include economic and technical cooperation that would allow all parties, regardless of their level of development, to maximize the opportunities made available by deeper and broader economic engagements.