Nearly half of the world’s population lives in China, India, Japan, South Korea, Australia, New Zealand, and the ten member states of the Association of Southeast Asian Nations (ASEAN), which have a combined GDP of$US21.2 trillion.
More importantly, these countries all also happen to be part of the proposed Regional Comprehensive Economic Partnership (RCEP), a “mega-regional” trade agreement.
And that fits into the larger trend in the global economy: regional trade reform is “on the move,” according to HSBC’s Douglas Lippoldt.
Other huge (and controversial) proposed trade agreements include the Trans-Pacific Partnership (TPP), which encompasses twelve countries in the Asia Pacific (including the US), and the Transatlantic Trade and Investment Partnership (TTIP), a free-trade agreement between the EU and the US that would be the largest planned regional trade agreement in terms of GDP.
These agreements “promise to facilitate trade and reduce protectionist measures” that still impede trade in many economies, according to Lippoldt. However, the potential adjustment costs have some analysts and politicians worried.
Still, overall, “their anticipated depth and breadth of coverage could promote structural reform across much of the world economy,” according to Lippoldt.