“The conclusion of the RCEP negotiations, the world`s largest free trade agreement, will send a strong message that will confirm ASEAN`s leading role in supporting the multilateral trading system, creating a new trade structure in the region, facilitating sustainable trade, reviving supply chains disrupted by COVID-19 and supporting post-pandemic recovery” Mr. Phuc said. Now that Trump`s opponent, Joe Biden, has been declared president-elect, the region is watching developments in U.S. trade policy and other issues. The agreement is also a blow to China, by far the largest market in the region, with more than 1.3 billion people, allowing Beijing to position itself as a “champion of globalization and multilateral cooperation” and give it greater influence over regional trade rules, said Gareth Leather, Asia`s chief capital economic economist. , in a report. The free trade agreement reduced tariffs to 7,881 product categories, or 90% of imported products at zero.  This reduction came into effect in China and in the original six ASEAN members: Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. The other four countries are expected to follow in 2015.  As soon as the first six signatories reached their target by 2010, the CLMV countries (Cambodia, PDR, Myanmar, Vietnam) adopted the same customs policy, with the same goal to be achieved by 2015.  In 2010, the ASEAN-China Free Trade Area became the largest free trade area in terms of population and the third largest in nominal GDP.
It was also the third volume of trade after the European Economic Area and the North American Free Trade Area.   As a result, ASEAN`s integration with China may attract more foreign groups, which each market alone could not attract. With a broader market, increased competition, higher investment and scale scales, investors will be more inclined to establish themselves in the integrated region. In addition, China`s share of ASEAN`s total trade rose from 2.1% in 1994 to 7% in 2003, making China ASEAN`s fourth largest trading partner after the European Union (11.5%), Japan (13.7%) 2000. United States of America (14%). Analysts are skeptical that Biden will insist that he re-agree on the Trans-Pacific trade pact or push back many U.S. trade sanctions imposed on China by the Trump administration, given the widespread frustration of Beijing`s trade and human rights balances and accusations of espionage and technology theft. The creation of an ASEAN-China investment space should also be one of two ways to generate more investment for ASEAN. Not only will more ASEAN and Chinese companies be willing to invest in the integrated market by reducing market risks and uncertainties, but U.S., European and Japanese companies interested in entering the Asian market will also be attracted to invest in the integrated market. Trade and investment flows into Asia have increased significantly over the past decade, a trend that has accelerated amid wrangling between the United States and China, which has imposed billions of tariffs on each other`s exports. A key feature of the agreement is the non-maintenance of quantitative restrictions and the removal of non-tariff barriers.  Removing these trade barriers will reduce the costs of trade transactions, further increase ASEAN-China trade and improve economic efficiency.
Because, under the free trade agreement, low-priced imports go from one member to another, production specializes, which increases real incomes in both ASEAN and China, with resources allocated to sectors where they can be used more efficiently and productively.