Indonesia, Southeast Asia’s largest economy will ratify its membership of the Regional Comprehensive Economic Partnership (RCEP) after seeking parliamentary approval.
The China-backed RCEP, the world’s biggest trade bloc, entered into force on Saturday, January 1, 2022, after seven nations in Southeast Asia, as well as Australia, China, Japan, New Zealand, and South Korea, according to Al Jazeera.
Details in the RCEP were agreed upon by leaders of 15 countries covering nearly a third of the global population and about 30 percent of its global gross domestic product (GDP) in November 2020.
Indonesia will likely book a trade deficit with members of RCEP in the early period of its implementation, but by 2040, the pact could boost Jakarta’s trade surplus to USD 979.3mn.
Indonesia’s Chief economic minister Airlangga Hartarto said a parliamentary commission overseeing trade rules had approved the ratification and its endorsement will be brought to a wider parliamentary vote in the first quarter of 2022.
“President Joko Widodo will sign off on the ratification after a parliamentary approval,” he said.
“Indonesia will likely book a trade deficit with members of RCEP in the early period of its implementation, but by 2040, the pact could boost Jakarta’s trade surplus to USD 979.3mn,” he added.
Further, it will also increase the country’s GDP growth by 0.07 percentage points and raise exports and imports by USD 5bn and USD 4bn respectively, Al Jazeera.
Indonesian rubber, steel, chemical, food, wood and mineral product exports are also expected to grow under the deal. (ANI)