The evolution of Asia’s regional trade architecture is one of the most important developments in the global economy. The continued emergence of China and India, numerous free trade and investment initiatives such as the Australia-Malaysia FTA and the Japan, China and Korea Trilateral Investment agreements and a wide range of regional economic cooperation and integration efforts are catalyzing new patterns in production supply chain networks and investment trends throughout East Asia.
In terms of a long term vision of bringing Asia’s FTA’s together, the various paths forward involving APEC, the East Asia Summit and the Trans-Pacific Partnership all have one thing in common: the centrality of ASEAN. Indeed, how ASEAN’s leading economies navigate these processes in relation to the objectives of their own regional trade liberalization and integration effort – the formation of the ASEAN Economic Community – will help shape Asia’s regional trade landscape.
The outcome of the 18th ASEAN Economic Ministers (AEM) Retreat last February in Naypyidaw was the crafting of a draft document entitled the ASEAN Framework on Regional Comprehensive Economic Partnership (RCEP). This RCEP articulates an ASEAN-led process for restarting and elevating discussions with FTA partners (namely Australia, China, Japan, South Korea, India, and New Zealand) and other trade partners to join ASEAN in creating a free trade area that targets the removal of 95 percent of tariffs on goods. The RCEP was formally endorsed by the ten ASEAN leaders at the 2011 ASEAN Leaders Summit.