A Brief Analysis Of The Main Regulations And Systems Of RCEP
On November 15, 2020, the Regional Comprehensive Economic Partnership (RCEP) was officially signed. The agreement will cover nearly half of the world's population and nearly one-third of trade volume. Its members include the 10 ASEAN countries, China, Japan, South Korea, Australia and New Zealand have a total of 15 parties. According to RCEP, the entry into force of the agreement requires the ratification of at least 9 of the 15 members, including at least 6 ASEAN member states and at least 3 of China, Japan, South Korea, Australia and New Zealand.
- Highlights Related To The Petrochemical Industry
- Highlights Related To The Petrochemical Industry
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Trade - Tariff Reduction
According to the official interpretation of RCEP by the International Department of the Ministry of Commerce, after the agreement takes effect, more than 90% of the trade in goods in the region will eventually achieve zero tariffs. China promises to fully open 86% to 90% of products, except for Laos, Cambodia, and Myanmar. Except for the underdeveloped countries, the corresponding proportion of other ASEAN members, Australia and New Zealand's commitment to China is roughly the same as or slightly higher than that of China. While the proportion of China's immediate zero tariffs on Japan and South Korea is relatively low, it maintains a balance between them.MORE -
Trade - Lower Trade Barriers
In addition to tariffs, RCEP reduces intra-regional trade barriers through various systems. For example, unlike bilateral agreements, the rules of accumulation of origin have been strengthened within the scope of fifteen member states, enabling a wider range of goods to enjoy tariff preferences; customs clearance procedures have been simplified, and advanced rulings, pre-arrival processing, information technology Use other efficient management methods to promote customs procedures, and release the goods within 48 hours after arrival as much as possibleMORE
Investment
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Impact of RCEP
1.Characteristics of Petrochemical Industry in RCEP Member Countries and Trade with China
2.Prediction of The Overall Impact on China's Petrochemical Industry After RCEP Takes Effect
3.Impact on Key Varieties That May be Affected -
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RCEP Members' Characteristics & Trade
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ASEAN
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South Korea
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Japan
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Australia
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New Zealand
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Overall Impact on China's Petrochemical Industry Prediction
Taking into account the influence of the existing free trade agreements between China and RCEP member countries, some scholars have predicted the cumulative impact
Taking into account the influence of the existing free trade agreements between China and RCEP member countries, some scholars have predicted the cumulative impact percentage of RCEP on specific industries in China during the "14th Five-Year Plan" period based on the Global Trade Analysis Model (GTAP) and related data research. . Among them, the domestic output of the petrochemical industry (mainly including coking products, petroleum, refined oil, etc., basic chemicals, other chemicals, rubber and plastic products) will be suppressed, with an impact ratio of -0.11%, while product imports and exports are expected to increase By 2.92% and 1.75% respectively.
- Impact on Key Varieties That May be Affected
- Impact on Key Varieties That May be Affected
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Petroleum Products
After RCEP comes into effect, the products that may be more affected are mainly light cycle oil, base oil, asphalt and petroleum coke, while the less affected products are mainly crude oil, gasoline, diesel, jet fuel, ship fuel, LNG and LPG .MORE -
Chemical Products
The effect of RCEP on the chemical industry after it takes effect can be summarized into two points. First, the positive impact from Japan and South Korea on tariff trade is beneficial to the import and export trade of the chemical industry. The trade agreement is relatively large, and China and Japan have reached a mutual tariff reduction and exemption agreement for related chemical products for the first time. Second, for chemical products that are highly dependent on foreign countries, China has adopted a relatively conservative tariff policy, which will slow down the rapid rise in foreign dependence to a certain extent.MORE
The Impact of RCEP on the Petrochemical Industry
Proposed Research Policies under the New Regulations
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The favorable impact of lower investment thresholds in member statesAlthough the export of China's labor-intensive industry products or mid-to-high-end products will be boosted in the short term, on the one hand, due to the yearly increase in domestic labor costs, textiles, light industrial building materials, toys, and daily chemical products that are closely related to the petrochemical industry.More
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Adverse effects on the domestic industrial chainAlthough the export of China's labor-intensive industry products or mid-to-high-end products will be boosted in the short term, on the one hand, due to the yearly increase in domestic labor costs, textiles, light industrial building materials, toys, and daily chemical products that are closely related to the petrochemical industry.More
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Favorable impact of lower trade barriers on the petrochemical industryThe petrochemical industry has long existed structural contradictions of low-end excess and high-end shortage. As the world's largest chemical producer, China faces challenges such as resource competitiveness and excess production capacity.More
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Adverse effects on the domestic petrochemical industryDomestic high-end refining and chemical products, fine chemical products, etc., such as semiconductor materials, panel materials, solar cell materials, etc., are relatively scarce, and domestic enterprises lack competitiveness in the face of Japanese and Korean enterprises with mature technologies.More
Business Development Advice
In the face of the preemption of overseas products in the domestic market in the future, enterprises should increase investment in research and development as soon as possible, improve the independent technical content of petrochemical products, especially in key and weak areas of relative protection by the state, make full use of the time window before tariffs are greatly reduced, and improve the core competitiveness in order to cope with market competition.In addition, petrochemical enterprises should gradually develop refining and chemical integrated enterprises, and lay out the entire industry chain to improve the efficiency of resource integration and competitive advantages, and improve the efficiency of enterprises.Finally, enterprises should adhere to the strategy of going global, especially in response to the growing consumer demand in ASEAN countries, take advantage of the advantages brought by RCEP, and combine external marketing and foreign investment to seize the potential markets of Southeast Asian countries.
- Respond
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- Policy
- Recommendations
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All domestic departments should promote the approval process of RCEP as soon as possible, and issue supporting implementation policies
At present, RCEP has not yet come into effect in China. On December 1, 2020, Premier Li Keqiang stated that the first is to strengthen inter-departmental coordination and accelerate the completion of domestic approval procedures.MORE -
Increase investment in technological innovation and talent training in the petrochemical industry
The tendentious support of national policies is a favorable impetus for technological innovation and progress, and the incentives for scientific research achievements should be increased to speed up the process of talent training.MORE -
Promote bilateral consultations with RCEP member countries and strengthen bilateral cooperation in the region
Taking RCEP as a platform and opportunity, strengthen one-to-one communication with other member states, strengthen intra-regional trade cooperation, and promote domestic excess capacity to the outside world; promote bilateral trade agreement negotiations with Japan.MORE -
Further improve the domestic business environment
The improvement of the business environment will help attract high-end enterprises to enter the country and promote the self-improvement of domestic enterprises. At the same time, it will help to slow down the speed of industrial chain transfer to ASEAN countries.MORE -
Guarantee the independent supply of domestic oil resources
In the context of the accelerated entry of foreign petroleum products into the domestic market, the state should guarantee the independent supply of domestic petroleum resources and ensure national energy security.MORE