Asian stocks traded higher on Monday after fifteen Asia-Pacific nations formed the world’s biggest trade bloc on Sunday at a regional summit in Hanoi, according to ASEAN’s press release. The Regional Comprehensive Economic Partnership (RCEP) bloc, a China-backed deal, excludes the U.S. and could cement China’s position as an economic partner in Southeast Asia, Japan, and Korea.
- RCEP will help Beijing reduce dependence on overseas markets and technology amidst the trade tensions with the U.S.
- The Asian block will progressively lower tariffs among the participating countries and set rules for data transmission.
- RCEP will address tensions in the South China Sea and develop plans for post-pandemic economic recovery in the region.
- RCEP pact will take effect once enough participating nations ratify the deal.
- The signing of RCEP pact is a blow to Obama-led Trans-Pacific Partnership (TPP) which Trump exited in 2017.
- RCEP will account for 30% of the global economy and population and reach about 2.2 billion consumers.
Asian stocks are currently gaining. NI225 is up 2.05%, HSI 0.86%
