Machine Industry Expects Overcoming COVID Crisis with RCEP Final Signing

Expected Effective Response to Global Trade Uncertainty Mitigation and GVC Blockification and Regionalization

[Asia Economy Reporter Kim Cheol-hyun] The Korea Machine Industry Promotion Association (Chairman Son Dong-yeon) announced on the 15th that with the final signing of the Regional Comprehensive Economic Partnership (RCEP) at the 4th RCEP Summit, the machinery industry is expected to establish a foothold for overcoming the COVID-19 crisis and to leap forward as a global powerhouse in materials, parts, and equipment.

The machinery industry evaluated this signing as the conclusion of about eight years of negotiations since 2012, highlighting the significance of launching the world's largest free trade agreement (FTA) amid the global economic contraction caused by COVID-19. The RCEP agreement is the world's largest FTA, accounting for about 30% of global trade volume, gross domestic product (GDP), and population. It is expected to alleviate global trade uncertainties and promote the expansion of free trade, as well as effectively respond to the trends of bloc formation and regionalization in the global value chain (GVC).

Furthermore, the Korea Machine Industry Promotion Association stated, "This RCEP agreement marks the first FTA with Japan, which raised concerns in the machinery industry due to many competing products with Japan. However, all sensitive machinery items are excluded from concessions, so expectations outweigh worries." They added, "As the public and private sectors are working together to reduce dependence on Japan for materials, parts, and equipment, where competition with Japan is intense, and to secure global competitiveness, the expanded economic zone provided by the RCEP agreement is expected to enable our companies to thrive."

This content was produced with the assistance of AI translation services.