In a significant move towards enhancing global trade connectivity, Chile lodged an application in June 2024 to join the Regional Comprehensive Economic Partnership (RCEP), alongside Sri Lanka and the Hong Kong Special Administrative Region. India is also reconsidering the option of becoming a member of this expansive free trade agreement.
The RCEP, the world’s largest free trade agreement, was established through eight years of meticulous negotiations led by the Association of Southeast Asian Nations (ASEAN). It has predominantly focused on fostering trade dynamics within North and Southeast Asia. Chile’s aspiration marks the first from the eastern Pacific, signaling a potential shift in the trade landscape.
Should Chile’s accession take place, the RCEP would begin to encompass a broader spectrum, potentially straddling both the Pacific and Indian oceans if India and Sri Lanka also join. This expansion could herald a new era of trade collaboration, connecting diverse economies and facilitating greater economic integration across continents.
Further strengthening Asia-East Pacific trade links, the impending opening of the Chancay mega port in Peru is expected to be a game-changer. Sixty percent owned by China’s COSCO Shipping, this port is the first major trade facility on South America’s west coast. It will enable direct trade between South America and Asia, eliminating the need for transshipment through Mexico or the United States. The new route is anticipated to reduce shipment times between Brazil and China by 15 days, significantly boosting trade efficiency.
These developments underscore a growing trend towards diversified global trade partnerships, with countries and regions seeking to enhance economic ties beyond traditional corridors. The inclusion of Chile, Sri Lanka, and potentially India into the RCEP could pave the way for more integrated and robust economic cooperation across the Asia-Pacific region.
Reference(s):
cgtn.com
