China-Australia, Trade Conflict Resolution through RCEP? Experts Say "Unlikely"

"RCEP Focuses More on Market Opening Than Trade Measures"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Although China and Australia have jointly joined the Regional Comprehensive Economic Partnership (RCEP), the world's largest free trade agreement (FTA), evaluations suggest that this will not serve as an opportunity to resolve the months-long trade conflict between the two countries.

On the 16th, Hong Kong's South China Morning Post (SCMP) reported on the previous day's signing of RCEP by China and Australia, stating, "Experts say this event could act as a 'circuit breaker' for the conflict, but the hope that it will ease tensions between the two countries is unlikely to materialize."

China and Australia have experienced repeated conflicts since the outbreak of the novel coronavirus disease (COVID-19) earlier this year. In April, Australia called for an international investigation into the origin of COVID-19, targeting China. In response, China criticized Australia and began economic retaliation. Following a ban on imports of beef produced at some Australian slaughterhouses in May, China imposed high tariffs on Australian barley. Additionally, China advised its citizens to refrain from studying and traveling in Australia.

Professor Heng Wang of the University of New South Wales in Australia cited the nature of RCEP as the basis for his prediction that tensions between China and Australia will continue. Although RCEP is larger in scale than the China-Australia Free Trade Agreement (ChAfta), it lacks provisions to resolve trade conflicts. He said, "RCEP focuses more on market opening measures such as tariff reductions rather than regulatory issues like trade remedies." Experts agree that when trade conflicts arise from political differences, it is practically difficult for dispute resolution procedures within agreements to resolve them.

There are also criticisms that despite the inclusion of dispute resolution clauses in the FTA between China and Australia, as in other trade agreements, these provisions have not been effectively utilized. Professor Henry Gao of Singapore Management University said, "ChAfta already contains a chapter on dispute resolution, but it has not been used. Some argue that regional agreements might be different, but I do not agree." He added, "If Australia does not bring this issue to the World Trade Organization (WTO), which is a legally viable option under trade agreements, it is naive to think that this problem will be addressed under RCEP."

Christopher Langman, Deputy Secretary of the Australian Department of Foreign Affairs and Trade, attended a global summit hosted by Chinese media Caixin on the 13th and emphasized that both China and Australia must keep their commitments to trade within the rules and treat each other equally. He stated, "Australia and China have had a long history of very productive economic and trade cooperation. However, there are currently issues affecting Australia's exports to China, which is concerning," and pointed out, "When trade is treated as a political tool, businesses suffer and we all face difficulties."

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