RCEP opens up important new opportunities for Australia

With the continuous development of the RCEP economy and the expansion of the middle class, RCEP will open up important new opportunities for Australian farmers, businesses, and investors. "On May 25th, Feng Baiwen, President of the China Australian Chamber of Commerce, delivered a speech at the RCEP Trade and Investment Exchange Conference - China (Fangchenggang) - Australia Special Event. He pointed out that using emerging opportunities in the fields of services and investment to supplement existing traditional advantages in commodity exports, It is a key theme of cooperation between Chinese and Australian enterprises.

Feng Baiwen pointed out that China and Australia have already reached a high-quality bilateral trade agreement, namely the China Australia Free Trade Agreement (ChAFTA). Since the agreement came into effect more than seven years ago, Australia's trade volume with China has almost doubled. Although RCEP has not provided Australia with new tariff reductions beyond the China Australia Free Trade Agreement, market access for Australian service providers and investors has improved, including in important areas such as professional services, education services, health services, and transportation services.

Cooperation between China and Australia in multiple fields is expected to achieve a win-win situation

China is the largest export destination for Australian food and fiber. Australian and Chinese companies have already collaborated on the use of agricultural and food technology solutions. Like other industries, Australian companies have the opportunity to collaborate with local companies, invest in China's food processing business, and provide leading technology and expertise in processing high-quality food exported from Australia in these facilities. This will enable Australian investors to benefit from the value created by downstream processing and distribution, and increase the elasticity of basic exports.

In the field of medical devices, Australian companies that invest in manufacturing facilities, train and cultivate medical professionals, and establish sales and clinical teams in China are doing better than companies that rely solely on Chinese imports. "Feng Baiwen said that digital technology enables Chinese medical professionals to acquire Australia's leading diagnostic capabilities in advanced tumor management and treatment, To support cancer treatment provided through the China Radiotherapy Center. Moreover, cooperation in the development and use of cost-effective low emission technologies and solutions in multiple fields such as electricity, industry, mining, manufacturing, and agriculture is expected to bring win-win results for Chinese and Australian companies.

RCEP brings benefits to Australian businesses

The benefits that RCEP brings to Australian companies are that it can improve a huge and rapidly growing regional integrated market and make it easier to enter. "Feng Baiwen said, firstly, RCEP will improve the opportunities for Australian service providers and investors in the region, and provide greater transparency and protection for Australian investors. RCEP provides important new channels for Australian businesses in the financial services, banking, healthcare, elderly care, education, and other types of service industries, including construction, engineering, and urban planning services. Secondly, establishing a highly integrated commodity trading market will reduce the compliance burden and enable Australian companies to establish and enter regional value chains. RCEP provides a single set of rules and procedures for obtaining preferential tariffs for the entire region. This can reduce costs and provide greater certainty and consistency for businesses to manage their supply chain throughout the region.

According to Feng Baiwen, one of the main advantages of applying for preferential treatment under RCEP is the "cumulative rule", which allows goods originating in one member state to be used as materials for producing new products in another member state and considered originating in a second member state. This means that enterprises can purchase raw materials from RCEP countries with cost, market, and other comparative advantages, and place production in these countries, while not losing the tariff benefits enjoyed under the RCEP Agreement when exporting the final product to buyers in RCEP countries.

Looking forward to creating a borderless digital ecosystem

Implementing these rules of origin and other commitments under the RCEP Agreement may result in multinational corporations in high-income RCEP countries transferring some production from high-cost environments to low-cost regions. This will incentivize manufacturers in RCEP countries to purchase from RCEP suppliers, rather than from suppliers outside the alliance. It will also attract more investment from outside the region, so that multinational companies from non RCEP countries can enjoy the benefits of RCEP. "Feng Baiwen said that the pursuit of cost savings and higher efficiency may be limited to some extent by the new requirements of high-income countries to protect critical supply chains and domestic production capacity.

As a supplier of raw materials and services used in the production or processing of finished products sold in the RCEP market, Australian companies will benefit from the new demand brought about by the applicable regional accumulation rules. Importantly, RCEP has also laid the foundation for broader regional cooperation and economic liberalization in the future. Feng Baiwen said, "In this regard, we look forward to further work to curb non-tariff barriers, coordinate technical standards and regulations, and create a unified and borderless digital ecosystem