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    Or Will Affect Half The World, The Textile Industry Will Change.

    2019/11/8 10:23:00 4

    RCEPRegional Comprehensive Economic Partnership Agreement

    After 7 years' long distance running, RCEP negotiations finally achieved a major breakthrough in November 4th. A total population of about 3000000000 or 1/3 GDP of the world, the largest free trade zone in the world will soon be born. So what is RCEP? What is the impact on the world trade pattern? What is the impact on the development of textile industry in member countries?


    One
    What is RCEP?


    Li Keqiang, premier of the State Council, attended the twenty-second meeting of leaders of ASEAN and China, Japan and South Korea (10+3) on the morning of November 4th morning in Bangkok, Thailand, and pointed out that the 15 member states of the regional comprehensive economic partnership agreement (RCEP) have concluded all text negotiations and virtually all market access negotiations.


    RCEP, the full name "Regional Comprehensive Economic Partnership", was launched in 2012 by ASEAN, including ten ASEAN countries, China, Japan, South Korea, Australia, New Zealand and India, with a population of 3 billion 560 million and GDP amounting to US $22 trillion, with a total trade volume of US $1 trillion and 30 billion.


    According to the Ministry of commerce data, RCEP covers 47.4% of the global population, 32.2% of global GDP, 29.1% of Global trade and 32.5% of global investment. It is currently the largest FTA negotiation in Asia, and is also the largest, largest and most influential FTA negotiations in China.


    RCEP, by opening the market to each other, reducing tariff and non-tariff barriers, and establishing a free trade agreement on regional economic integration between the 16 countries.


    On the morning of November 5th, according to a number of media reports in India and the confirmation of a spokesman for the Ministry of foreign affairs of India, India Prime Minister Moody's has announced that the current negotiation content of the agreement is not conducive to India's national interests, so India will not join the agreement.


    Two
    What is the impact of RCEP on the world trade pattern?


    The success of the RCEP negotiations means that countries and regions that make up nearly half of the world's population are expected to achieve low tariffs or even zero tariffs, which has opened up new space for the high quality development of China's foreign trade.



    Positive global multilateral trading system


    The progress of RCEP is a great benefit to the global multilateral trading system, economic globalization and market.


    Jiang Yuechun, director of the Institute of world economics, China Institute of international studies, pointed out that once RCEP is achieved, it will help to deal with the negative effects of unilateralism, especially the protectionism of the United States, and promote a virtuous circle of international trade and provide a new strong impetus to the world economy.


    Huang Xilian, China's ambassador to ASEAN, said recently that RCEP is very important for promoting the development of trade in the Asia Pacific region and the growth of Global trade and economy, maintaining a free, open, inclusive and multilateral trading system and creating a regional policy environment conducive to trade and investment development. Agreement at an early date is conducive to safeguarding economic globalization and trade liberalization and achieving mutual benefit and win-win situation.



    The prospect of regional economic integration is clear.


    The Asia Pacific region is one of the most dynamic sectors of the global economy. RCEP will make the prospects for economic integration in the Asia Pacific region clear and conducive to trade balance, industrial innovation and employment expansion in the region.


    Jiang Yuechun believes that RCEP will play an important role in promoting the process of regional economic integration. After the agreement is reached, it will be more conducive to trade and investment in the region, as well as the economic development of the whole region. It will help promote the process of regional integration and further promote the construction of the East Asian Economic Community in the future.


    Cai Weicai, senior vice president of Thailand Kai Tai bank, said that RCEP will become an important mechanism to promote regional economic integration in Asia. With the promotion of RCEP, the Asian regional value chain will become closer. Driven by the RCEP and the "one belt and one way" initiative, China and ASEAN will cooperate more closely and become the main driving force for the healthy development of the global economy in the future.


    Yu Miaojie, vice president of the National Development Research Institute of Peking University, believes that RCEP will promote economic cooperation among member countries in several areas, such as commodity trade, service trade and investment. Once the agreement is signed, it will help RCEP member countries better integrate into the global economic integration.



    Open space for China's exports and investment


    Jiang Yuechun said that RCEP will help expand China's economic and trade exchanges with other countries in the region and open wider space for China's exports and investment. For Chinese consumers, more high-quality foreign products will enter the Chinese market with lower tariffs and better satisfy the growing pursuit of a better life.


    Xu Ningning, executive director of the China ASEAN Business Council, said that speeding up the implementation of the free trade area strategy is an important part of China's new round of opening up. RCEP is conducive to the development of regional cooperation potential and the further development of regional economic integration.


    Three
    What's the impact on the textile industry?



    Good rules of origin, circulation of textile raw materials


    This year, the RCEP negotiating committee will focus on the discussion and planning of the rules of origin in terms of public clauses. Unlike CPTPP, there are strict rules of origin requirements for products that enjoy zero tariffs on member countries. For example, the textile and apparel industry adopts the rule of Yarn Forward, that is, the purchase of yarn must start from the member countries, so as to enjoy zero tariff preferences. One of the key points of the RCEP negotiations is to realize the sharing of a common certificate of origin in 16 countries. Asia will be integrated into the same comprehensive origin. Undoubtedly, this will bring great convenience to the 16 textile and garment enterprises in terms of suppliers, logistics and customs clearance.



    Will solve Vietnamese textile raw materials concerns


    Zheng Qiu Qiu, director of import and Export Bureau of Vietnam's Ministry of industry and trade, said the bright spot that RCEP will bring to Vietnam's export industry is the rule of origin, that is, in one country, products produced from raw materials from other member countries are still regarded as the origin of the country.


    For example, at present, Vietnam uses many products produced from raw materials in China to enjoy preferential tax rates when exported to Japan, Korea and India. According to RCEP, Vietnam uses raw materials produced from other member countries as the origin of Vietnam, and enjoys preferential tax rates when exported. In 2018, Vietnam's textile industry exported US $36 billion 200 million, but imports of raw materials (such as cotton, fiber and accessories) amounted to US $23 billion, most of which were imported from China, Korea and India. If RCEP can be signed, it will solve the Vietnamese textile industry's concerns about raw materials.



    The global textile supply chain is expected to form a dominant pattern in China + neighboring countries.


    As China's textile and apparel industry has been constantly upgrading in terms of R & D, design and production of raw and auxiliary materials, some low-end manufacturing links have been transferred to Southeast Asia. While China's trade in textile and apparel products in Southeast Asia has declined, the export of raw and auxiliary materials will increase significantly.


    Although the textile industry of Southeast Asian countries represented by Vietnam is on the rise, Chinese textile enterprises are not completely in the position of being replaced.


    RCEP, which is jointly promoted by China and Southeast Asia, is also aimed at achieving the goal of win-win cooperation. Through regional economic cooperation, China and Southeast Asian countries will achieve common development.


    In the future, the global textile supply chain is expected to form the dominant pattern of China + neighboring countries. Source: cotton textile technology new media, Tai Yao textile

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