It will be useless, since ALL countries in RCEP want to run current account surplus and no one really want the role to absorb surpluses, i.e running current account deficit and ditch capital control and let their currency float.

For this to even work, someone has to run current account deficit and runs capital account surplus (play the role of the US). No one is willing to lol.

NY times actually summarizes it pretty well: It has little impact on legal work, accounting or other services that cross borders, and does not venture far into the often-divisive issue of ensuring greater intellectual property protections https://www.nytimes.com/2020/11/15/business/china-trade-rcep...

If it has no actual effect, that’s actually scarier for US partisans than if it was genuinely an economic boon.

The simple reason being that it indicates that all these countries, including US allies, are willing to put their names on an agreement with China which will only serve to anger the US even if there is no material benefit in doing so.

That’s either a huge FU to the US, or more likely, them believing, unlike in 2016 after the TPP, that it’s more important to keep China happy because the US will have relatively less influence in the region.

Either way, it indicates that the leadership of the countries who signed up for this believe that the relative strength of the US vs China in the region has reduced.

I'm sure all these countries would do trade deals with the US if the US had a deal-maker leader who ascribed to the philosophy of win-win.

Is it really a win-win though when alot of deals/projects now already languish?

If people think the investor covenant situation in the US is bad, it's that much worse in asia. A lot of money burning pits and lack of fast progress isn't really going to change unless the situation on the ground can actually improve and it wont happen from diktats (TPP, RCEP, etc) from above.

Not saying RCEP or TPP are good deals - just that if all parties tried to construct mutually beneficial deals there’s every reason to expect countries to trade with USA.

China has deficit with Australia NZ, Japan and Korea. Besides with dual circulation strategy China probably will be more open importing from South East Asia. Therefore, any attempts of decoupling or supply chain realignment will target South East Asia first in which China has a significant influence.

> China has deficit with Australia NZ, Japan and Korea.

Japan had a trade DEFICIT with china in 2019, 15B. https://www.japantimes.co.jp/news/2020/01/23/business/japan-... "marking a second straight year of red ink amid slowing demand in China"

> Therefore, any attempts of decoupling or supply chain realignment will target South East Asia first in which China has a significant influence.

The governments of India, Vietnam, and Indonesia vehemently disagree with you. And it's not ATTEMPT. Supply chain moving away from China is fully underway for several years already. Foxconn already declared that China is no longer the world's factory. https://appleinsider.com/articles/20/08/12/foxconn-says-trad...

> Japan had a trade DEFICIT with china in 2019

This is completely wrong. Japan has an overall trade deficit, but not with China. It runs a 30B trade surplus trading with China, according to Chinese foreign ministry[1].

https://www.fmprc.gov.cn/web/gjhdq_676201/gj_676203/yz_67620...

> The governments of India, Vietnam, and Indonesia vehemently disagree with you

Which part they are disagree with?

For the Foxconn statement.. I'll wait and see, they are prone to overpromise

>"Such announcements are far from unusual for Gou, and often, nothing comes of them. In Vietnam in 2007, in Brazil in 2011, in Pennsylvania in 2013, and in Indonesia in 2014, Foxconn announced enormous factories that either fell far short of promises or never appeared."

https://www.theverge.com/21507966/foxconn-empty-factories-wi...

Btw Foxconn just pivot back to China

https://www.forbes.com/sites/ralphjennings/2020/05/07/iphone...

South Korea never had current account surplus with Japan, more than 50 years and counting. Yes, South Korea wants to run current account surplus, but that does not mean running current account surplus with RCEP. In fact there is nothing contradictory about everyone in RCEP running current account surplus and within RCEP trade balancing out.

"…and within RCEP trade balancing out."

This remains the biggest question, and imo would require china to invest a lot more uncollateralized in SEA than they do already (most doable), or import a lot more from SEA (I do not see this happening).

"No one is willing to lol."

No one is willing to laugh out loud. I don't know what that means?

Found the A"I" lol

I believe it's supposed to be "No one is willing to, lol". In this case "lol" is describing what the writer is feeling about this statement, not what the objects of his writing are doing.

The confusion is due to the missing ",". However, it can be surmised that the omission was for brevity or by accident, and not intentionally to convey a meaning which would otherwise be inconsistent with the preceding sentences.

No one is willing to run a current account deficit. I'm assuming the "lol" is mocking RCEP overall.

One thing is for sure, as an US expat in SEA, china is #1 economically in the region as far as investing, not because they are any good, but lack of will from US investors in large… and in this environment, I'm not so sure getting in now is best because the lack of high quality collateral available to back investments if things go south (or get hold up for years like they have with projects…)

I'm more interested in to see if this will translate to more offshore usage of the chy, and offshore chy loans… if not, things will remain status quo (boondoggles)…

> No one is willing to lol

No one is willing to do it. Ha ha ha.

The only thing matters here is the trade deal between Japan and China.

> Posted something about this earlier in the day but didn't gain any traction.

AFAIK, hacker new is moderated and only 1 article about a topic can show up on the front page.

I was shocked by that. Does anyone who knows more about this or foreign policy in general want to enlighten us? What motivated Australia, Japan, and SK to sign on to this? Do they not fear alienating the US? I suppose once we scuttled the TPP they had no alternatives?

For Australia it's our Raw Materials (Iron Ore, Coal that sort of stuff) and Natural Gas. China, Japan, Korea are huge trading partners.

Education is the other big item, Australian universities attract a lot of foreign students and that sector is a big money earner. On the radio this morning there was talk about standardizing qualifications making more Australian degrees recognized in member countries.

It comes along at a pretty interesting time there are a lot of tension between China and Australia at the moment. There's handwringing locally over China being granted 99 year ownership leases on some of our ports. Chinese telecom firm Huawei was blocked from our 5G network for "National security" etc.

China has been threatening to block (and in some cases have blocked) shipments of Australian products there have been tariffs on Australian Barley implemented etc, ostensibly in retaliation to some foreign affair stuff. Australia called for an international enquiry into origins of Covid which really annoyed China.

> Education is the other big item, Australian universities attract a lot of foreign students and that sector is a big money earner. On the radio this morning there was talk about standardizing qualifications making more Australian degrees recognized in member countries.

This is so fascinating! I knew Australia hosts a lot of Chinese students but they're really on their way to making education an export of theirs. Thanks for the perspective. I'm beginning to see the huge potentials of this treaty for the parties involved.

IIRC education is Australia's 3rd largest export.

Part of the education deal is access to short or long term migration to Australia, so the dollar figure really a combination of education, lifestyle and migration opportunities.

South Korean here. To me, RCEP seemed like an obviously good thing to sign, and I am shocked that people in US are shocked or that they think SK should fear alienating US. TPP is irrelevant since SK was never a party to TPP.

What do you think about the IP parts of RCEP?

I find it unfortunate, but I recognize that as a newly minted culture exporting nation South Korea at large is in favor of stronger copyright enforcement, and that my personal opinion that copyright is currently too strong and detrimental to culture holds little sway.

Exactly. If they don't sign, they get left out. And then what? wait until the US somehow decides to join and only then join?

It’s good leverage for all the parties involved. For example, they can make another TPP with the US but on more advantageous terms

> What motivated Australia, Japan, and SK to sign on to this?

Most likely the fact that the US becoming more isolationist forces traditional allies to enter into agreements that they wouldn't have considered previously. In this instance, this is the first trade agreement that has had China, Japan, and South Korea as signatories. Also, despite their posturing China is a HUGE economic power and everyone in the region would prefer to ride that wave instead of be crushed by it.

> Do they not fear alienating the US?

To a certain extent the US has alienated the rest of the world with it's "America first" Trump policy. This is just the logical progression of countries moving on to fill the economic power gap the US has left in the Pacific.

> I suppose once we scuttled the TPP they had no alternatives?

Lol. Everyone else went onto sign the CPTTP which went into effect 30 Dec 2018 which was largely identical to the original TTP, excluding the inclusion of the US of course.

> What motivated Australia, Japan, and SK to sign on to this

Money apparently. China will lift its tariff against 90% of imports from Japan, increasing from 8% currently. Also Japan and Korea would have similar tariff treatment between each other. South Korea and China already had their own FTA, so it won't matter that much, but has no negative impact either.

Exactly, Japan actually benefits more.

Australia, Japan, and SK are sovereign nations.

Totally agree. I'm not passing any judgments on what they did. It's just that in other areas of policy, they've been apprehensive about China so I'm shocked to see this. They must have had good reasons for doing this so I want to better understand their perspective on this and how that ties into those countries' strategy for managing an emerging superpower that rivals their traditional ally.

Relations between China and other Asian countries aren't as bad as what the western mainstream media portrays. China is far more willing to negotiate win-win deals, and is far less of a boogeyman/invader, than what mainstream media wants you to believe. Pompeo visited many countries, urging everyone to 'unite and stand up against the bully that is China', but the reality is very different from that narrative, and as a result Asian countries signed the RCEP instead.

The Western narrative of China is a bubble of alternate reality. This RCEP event shows you just how alternate it is.

South Korea is a trading nation, and is in favor of free trade. South Korea defaults to yes for trade deals. US is an ally, but if US is against free trade, South Korea will not go with US. Unlike US, international trade is of vital importance to South Korea.

Judging by the numbers I would say international trade is of vital importance to the US.

US trade to GDP ratio is <30%. For South Korea, it's >70%.

Doesn't the US have a free trade agreement with Korea?

It does.

Australia has never been and will never be a sovereign nation. It used to be part of the british empire and is now part of the american led anglo-protectorate. They are part of the anglo world and I can't ever see us letting them leave.

Sovereign nations don't have foreign occupation forces. Japan and SK are occupied client/vassal/satellite states. We can call them allies if we want to save face, but if china or russia had occupation forces there, we'd call them vassals or satellites or client. Ultimately that's what they are.

We'd never call warsaw-pact nations sovereign states, wonder why we call japan or sk sovereign states?

Let's go back before the British arrived. There were many (and still are) many sovereign indigenous nations in what's now known as Australia

> There were many (and still are) many sovereign indigenous nations in what's now known as Australia

There are no sovereign indigenous nations in australia. You will not find them as members in the UN, you will not find them on maps, they cannot form any sovereign treaties with other nations, etc.

The idea of "sovereign indigenous nations" is just virtue signaling. Maybe one day they will be free and sovereign nations, but I seriously doubt it.

Many years later, as he knelt before Emperor Xi, Donald Trump Jr. was to remember that distant afternoon when his father had a chance to form TPP, the everyone but China trade agreement.