What is the RCEP?

BEHIND THE SCENES

Alfred P. Dizon

The Regional Comprehensive Economic Partnership was recently ratified by ASEAN member nations including the Philippines purportedly to boost economies of member countries.
    But this early, it is getting criticism from analysts.
    Here is one by Darren M. de Jesus:
    The Senate, after two years, has ratified the Regional Comprehensive Economic Partnership, or RCEP, under the 1987 Constitution which requires international agreements to be concurred upon by two-thirds of the Senate, even after its ratification by the President. It took a while, around 10 years to be exact, spanning three administrations, for the RCEP to be adopted by the Philippines, and it was ratified at an unholy time — when onion prices were sky-high.
    Just like the Metro Manila Subway, the RCEP took years of planning and debate before it was approved and ratified. And possibly just like the Metro Manila Subway, it may encounter hiccups down the road.
    The RCEP is a free trade agreement or FTA among the ten ASEAN member nations and their FTA partners, namely, China, Japan, South Korea, Australia and New Zealand.

The presence of an export giant and our favorite neighbor, China, brings forth a gargantuan elephant in the room. The cultural and economic diversities of the member nations bring into question whether or not the RCEP will be implemented properly and fulfill its purpose at all.

RCEP sounds good on paper and in the soundbites of our political leaders.

It is filled with motherhood statements that would make your mouth water and have you believe that it guarantees prosperity and good fortune for our Filipino workers, particularly those in the agricultural sector.

The reality is that it most likely won’t — if we do not act strategically towards the RCEP. In other words, from the way I understand it, the RCEP will just be another piece of signed legislation if we continue with our ways, which we feel are not broken. So why fix it?

I chanced upon a wonderful infographic on President Bongbong Marcos Jr.’s social media account on the benefits the RCEP will bring. However, these are merely reminiscent of the infographics issued by state agencies on how certain bills and newly enacted laws will change the lives of Filipinos — but they ended up as failed legislation. But unlike other bills, RCEP is an international agreement with no funding required. Rather, it removes or lowers tariffs to encourage and allow the seamless flow of goods in and out of the country.

Of course, dealing with customs is an important, yet undiscussed matter, that can make or break transactions in the Philippines, but that’s another story altogether.

I am particularly interested in the RCEP because I would like to see how different industries will react to it. The Philippines appears to benefit from the RCEP on the importation side considering that has been our knee-jerk reaction to industry shortages.

Export-heavy countries, such as China and Japan, will clearly benefit from the RCEP right at the outset. This could be the early case after the RCEP’s enactment. What I am most interested in is whether or not specific businesses could use the RCEP to their advantage to make our locally produced goods known and recognized abroad.

I recall reading a piece on how local coffee growers could benefit from RCEP. Philippine coffee is a distinct type of coffee that may be exported to RCEP member states. Other businesses must take note of whether RCEP can uplift their lives. This may be our chance to transform the Filipino business model — instead of exporting our people, let’s export our products. The success of RCEP is dependent on the encouragement of the government and the innovation of the private sector.