Free Trade Area of the Asia-Pacific Promotes Regional Economic Integration

Negotiations are underway to upgrade the ASEAN-China Free Trade Area, a free trade agreement that significantly boosts economic interdependence between China and ASEAN. It is also part of the foundation of the RCEP which, as earlier mentioned, is still under negotiation.

Negotiations on the China-Japan-South Korea Free Trade Area also play an important supportive role in the RCEP. As China, Japan, and South Korea are the predominant parties among the 16 RCEP members, establishment of the free trade area among this “big three” also plays a key role in RCEP construction. Despite adverse effects of the China-Japan relationship, negotiations on the China-Japan-South Korea Free Trade Area are progressing through joint efforts. The three parties have set a timetable in efforts to accelerate the process.

Negotiations on the China-South Korea Free Trade Area, believed to facilitate talks over the China-Japan-South Korea Free Trade Area, are also under way. The word is that the two sides still have differences over certain industries. However, both governments display confidence that negotiations will conclude by the end of this year, which implies that the China-South Korea Free Trade Area is also likely to be established before year-end. Realization of the anticipated chain reaction – whereby the China-South Korea Free Trade Area hastens establishment of the China-Japan-South Korea Free Trade Area, so propelling RCEP negotiations towards concrete results – will substantially promote Asia-Pacific economic integration.

Win-win Prospects

The Asia-Pacific win-win strategy concept having been raised, APEC, as a platform to construct the Asia-Pacific win-win partnership, has reached a preliminary consensus on establishing the FTAAP. It might be said that the effect on APEC of the U.S. TPP program has been more or less remedied. This is indeed the issue of most concern to the 2014 APEC in China. It is to be expected that China, with fast economic growth and increasingly enhanced power, will play a growingly active and constructive role in APEC. The openness of the Chinese market and China’s investment in regional cooperation implies a rise in potential APEC gains. This is China’s contribution, and also one of the sources through which APEC can achieve its win-win prospects in the Asia-Pacific.

WANG YUZHU is director of the Center for APEC and East Asian Cooperation of the Chinese Academy of Social Sciences.