RCEP trade deal: US should worry less about China’s role and more about being left out
- The challenge is not that the world’s biggest trade deal is China-led or heralds a Sinocentric order – both of which are misrepresentations anyway – but that the Asia-Pacific region has shown no need of US leadership or even involvement
The RCEP, according to this view, is the latest evidence of an emerging Sinocentric regional, and maybe even world, order. But this is a misrepresentation.
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RCEP: 15 Asia-Pacific countries sign world’s largest free-trade deal
The RCEP thus indicates that Asian nations are willing to forge a path without US leadership, or even involvement, where necessary. Even some of America’s closest allies – Japan, South Korea, Australia and New Zealand – have forged ahead with the CPTPP and RCEP without US participation.
But while it may underline a missed opportunity for the US, the RCEP does not necessarily point to a new Sinocentric order. For a start, the RCEP was not led by China, even though the Chinese economy is by far larger than the other 14 economies involved. Rather, the RCEP was led by the Association of Southeast Asian Nations and effectively follows on from a series of trade agreements that Asean had signed with China, South Korea, Japan, Australia and New Zealand.
The RCEP does not so much break new ground as consolidate existing agreements into one overarching accord. RCEP members already have some bilateral free-trade agreements among themselves that are more profound and ambitious than the RCEP. Far from making rules and setting standards in the region, the RCEP is working to the lowest common denominator.
It is therefore not true to say the RCEP reflects an emboldened China leading Asia to develop a regional order without the US and setting itself up as the region’s rule-maker.
The RCEP has been signed, but resistance to China could prove a hurdle
Still, the RCEP’s creation is good news for China (and, by extension, bad news for the US). By creating a large trade bloc, the RCEP eases trade friction throughout much of East Asia. While certain areas of the deal, such as rules for services and intellectual property, are no stronger than existing rules, suppliers across East Asia will now need just one certificate of origin, which will ease regional trade.
All of which is to say that while the RCEP is significant, momentous and reflective of broader global trends, it does not yet indicate a region led by China. But Washington is also being left behind – or left out – in the development of regional architecture, even as it tries to demonstrate its relevance and interest in the region.
In the longer term, this may be the biggest challenge the RCEP poses: a region not led by China, but also not looking for US leadership.
Christian Le Miere is a foreign policy adviser and founder of Arcipel, a strategic consultancy