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Government likely to miss RCEP ratification target in Q1
Indonesia is likely to close its first quarter this year without ratifying the Regional Comprehensive Economic Partnership (RCEP), potentially losing out on multiplier effects from the world’s largest free trade agreement.
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Representatives of signatory countries are pictured on screen during the fourth Regional Comprehensive Economic Partnership (RCEP) Summit held online during the ASEAN Summit on Nov. 15, 2020. (Courtesy of Trade Ministry/-)
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ndonesia is likely to close its first quarter this year without ratifying the Regional Comprehensive Economic Partnership (RCEP), costing businesses and further delaying its economy from benefiting from the world’s largest free trade agreement.
The RCEP, a landmark agreement signed by 10 ASEAN member states and five of their regional dialogue partners, entered into force at the start of the year. Up until this month, however, Indonesia remains among the few countries that have yet to ratify the deal, alongside Myanmar and the Philippines.
Previously, the government set out to have the deal ratified at the House of Representatives in January but failed to finalize the bill, leading officials to push back the deadline to the end of the first quarter. However, with just days until the end of March, it is becoming increasingly unlikely that this objective will be met.
Coordinating Economic Affairs Minister Airlangga Hartarto has guaranteed there would be no more delays. He said President Joko “Jokowi” Widodo had signed off on the draft bill and it would be sent to the House in the coming days with a view to ratifying it in the current sitting period ending April 14.
“The sitting period just started last week, so we hope to get it ratified this session,” he told The Jakarta Post on March 22.
The RCEP eliminates up to 92 percent of tariffs for goods traded among its 15 members and standardizes many regulations on customs, investments, intellectual property and e-commerce.
The trade deal has been dubbed the largest in the world, covering 30 percent of global gross domestic product (GDP), a quarter of global trade and 31 percent of global foreign direct investment (FDI) inflows.
