The Regional Comprehensive Economic Partnership (RCEP) Agreement entered into force for Indonesia on 2 January. The preferential tariffs under the agreement can now be utilised by the private sector who are exporting to and/or importing from Indonesia.
Additionally, the private sector can take advantage of the simplified rules of origin and trade facilitation in their business activities involving Indonesia.
In a release issued by the Indonesian Ministry of Trade, Minister of Trade Zulkifli Hasan said that the RCEP Agreement is expected to increase competitiveness and strengthen global production network, promote regional supply chain through better market access for exports of goods and services, reduce or eliminate trade barriers, and enhance transfer of technology.
“The entry into force of the RCEP Agreement on 2 January 2023 is timely to mark the beginning of Indonesia’s ASEAN Chairmanship in 2023. Indonesia has been the driving force in RCEP since the conceptualisation phase, and we hope more milestones, such as the establishment of the RCEP Support Unit, can be achieved during Indonesia’s ASEAN Chairmanship this year,” said Satvinder Singh, Deputy Secretary-General for the ASEAN Economic Community.
Indonesia is the largest economy in ASEAN and the fifth largest among the RCEP parties. Its economy grew by 3.7% in 2021 to US$1.186 trillion, making up 4% of the combined GDP of RCEP economies. The World Bank projected Indonesia’s economy to grow by 5.2% in 2022 and 4.8% in 2023.
The entry into force of the RCEP Agreement for Indonesia brings the full implementation of the RCEP Agreement one step closer to making ASEAN the hub of production networks within the region.
The RCEP Agreement was signed on 15 November 2020 by 15 countries including the 10 ASEAN Member States, Australia, China, Japan, Korea, and New Zealand.
Previously, the RCEP Agreement entered into force on 1 January 2022 for Brunei Darussalam, Cambodia, Lao PDR, Singapore, Thailand, Viet Nam, Australia, China, Japan, and New Zealand; on 1 February 2022 for Korea; and on 18 March 2022 for Malaysia.