China-backed trade deal pushed back to 2019

The summit took place in Singapore, where leaders from the ASEAN discussed the deal. (AFP)
Updated 13 November 2018

China-backed trade deal pushed back to 2019

  • Trade diplomats said negotiations will run deep into 2019
  • The Regional Comprehensive Economic Partnership (RCEP), covering half the world’s population, is billed as an antidote to President Donald Trump’s “America First” agenda

SINGAPORE: A China-backed bid to complete the world’s largest trade deal — without the United States — was pushed back to next year after Asia-Pacific trade ministers failed to agree key terms at a Singapore summit.
The Regional Comprehensive Economic Partnership (RCEP), covering half the world’s population, is billed as an antidote to President Donald Trump’s “America First” agenda, which has seen tariffs imposed on almost half of all Chinese imports to the US — and retaliatory levies by Beijing.
Chinese Premier Li Keqiang, who is attending a Singapore summit to rally support for the deal, said he hoped RCEP would be signed and implemented next year.
“It (RCEP) is going to deliver real benefits to the people of our region,” he said in an address Tuesday.
China was now the standard bearer of global free trade, he added, with the RCEP — a sweeping 16-country deal that includes China, Japan, India and the 10 members of ASEAN (Association of Southeast Asian Nations) — at the heart of its strategy.
“It’s going to send a message to the international community that we stand by free trade... with rising protectionism and strains on free trade we need to advance the RCEP negotiations,” Li said.
He conceded the Chinese economy was facing “challenges” in the wake of the trade war with the US, but insisted strong fundamentals meant radical intervention was not the remedy.
“Despite downward pressures we will not resort to massive stimulus,” Li said.

Trade diplomats said negotiations will run deep into 2019.
“We made significant progress,” New Zealand minister of state for trade and export growth Damien O’Connor told reporters after talks late Monday.
“But we are very happy with that and is heading in the right direction.”
India’s concerns over opening its markets to competition, in particular from Chinese firms, has been a key sticking point in the several years of negotiations.
But New Delhi’s delegation welcomed the incremental steps toward the establishing the trade agreement.
“The future lies in RCEP,” Indian trade minister Suresh Prabhu told reporters, but urged a patient approach to talks to ensure “every country will benefit from it.”
Several general elections scheduled early next year — including in India, Thailand and Indonesia — have complicated the timeframe of a deal that will open markets in countries covering nearly half the world’s GDP.
A draft leaders’ statement on the RCEP seen by AFP noted the urgency of reaching an agreement “given the current headwinds faced by the global economy.”
RCEP was given extra impetus after Trump pulled the US out of the rival Trans-Pacific Partnership (TPP).
The TPP is still alive even without Washington, but RCEP is now the world’s biggest trade deal.
However, the Beijing-backed pact is much less ambitious than the TPP in areas such as employment and environmental protection.
The ASEAN summit, which formally opens Tuesday afternoon, is expected to sweep in trade, maritime disputes and the Rohingya crisis.
Key world leaders including China’s Li, Russian President Vladimir Putin and Mike Pence — Trump’s number two — are also in Singapore for talks foreshadowed by the China-US trade war and its ripple effect on global economies, particularly in Asia.
Pence is also expected to keep pressure on Beijing over its growing aggression in the South China Sea while seeking support over Washington’s approach to the denuclearization of the Korean peninsula.
Myanmar’s de facto leader Aung San Suu Kyi is also in Singapore and is likely to face intense scrutiny over her country’s treatment of the Rohingya, particularly from Muslim-majority nations at the summit.
Amnesty International on Monday stripped Suu Kyi of its highest honor, citing her “indifference” to the atrocities committed by Myanmar’s army against the minority.


Argentine economy minister resigns amid deepening crisis

Updated 6 min 22 sec ago

Argentine economy minister resigns amid deepening crisis

  • The country’s peso ended the week having shed 20 percent of its value against the US dollar

BUENOS AIRES: Argentina’s Economy Minister Nicolas Dujovne resigned after a week of economic tumult caused by President Mauricio Macri’s defeat in a primary poll ahead of a general election.

Dujovne will be replaced by Hernan Lacunza, economy minister for Buenos Aires province, Argentine media reported.

The country’s peso ended the week having shed 20 percent of its value against the US dollar as both Fitch and S&P cut the South American country’s long-term credit rating, citing increased uncertainty and a rising risk of default.

Dujovne said, in a letter posted on the website of La Nacion newspaper, he was “convinced that, under the circumstances, the (government’s) management needs significant renewal in the economic arena.”

He leaves in the middle of a deepening economic crisis following last Sunday’s primary elections in which market-friendly Macri was dealt a huge blow in his bid for re-election when he polled 15 points less than center-left Peronist candidate Alberto Fernandez.

The primaries serve as a bellwether for general elections in October. Dujovne’s announcement marks the first change in Macri’s Cabinet since voters went to the polls.

Fitch, which downgraded Argentina’s credit rating two notches to “CCC,” said the center-right’s defeat “increases risks of a break from the policy strategy of the current administration of Mauricio Macri guided by a program with the IMF.”

Fernandez, now the clear favorite to unseat Macri, has questioned the reform program backed by a $56 billion rescue package from the International Monetary Fund.

Standard & Poor’s dropped Argentina’s rating a single grade from “B” to “B-.”

“My resignation is consistent with a government and political space that listens to the people and that acts accordingly,” Dujovne said, in a clear message to the Argentine electorate.