Last Saturday, the Association of Southeast Asian Nations (ASEAN) and Japan signed the first protocol to amend the comprehensive economic partnership (AJCEP) to expand trade, goods and services, and investments among member states and Japan.
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The agreement was signed by the Asean Economic Ministers (AEM) on the sidelines of the seventh Regional Comprehensive Economic Partnership (RCEP) Intersessional Ministerial Meeting in Siem Reap.
The first protocol incorporates AJCEP’s robust chapters on trade in services, movement of natural persons and investment, marking an important milestone in ASEAN-Japan economic relations.
These chapters including texts on protection, liberalisation, promotion, and facilitation provision on investment, will deepen and broaden investments, elevate ASEAN and Japan’s strategic partnership, and support further economic integration in East Asia.
Welcoming the agreement, Ramon M Lopez, Philippines secretary of trade and industry, says AJCEP will expand the current CEP.
He believes the initiative by both parties would renew Japan’s 10 years strategic economic cooperation roadmap while ensuring the latter’s continued presence as a strong anchor in regional trade, and as an important partner in ASEAN.
Japanese Economy, Trade and Industry Minister Hiroshige Seko says members states and Japan are major trade and investment partners.
Seko says the service sector in Japan such as retailing and distribution have been actively increasing investment in the region, which has led to quality employment.
The Japanese supply chain between ASEAN and Japan has deepened with more companies joining the venture in future.
“I firmly believe that this protocol would enhance our economic relationship with ASEAN member states. To realise such benefits, we should accelerate this domestic procedure,” Seko says.
Suon Prasith, deputy director-general for International Trade of Commerce Ministry says the amendment to the first protocol is crucial for Cambodia as it will have more market access and can export more products to Japan.
“AJCEP will open up opportunities in trade, goods, and investment from Japan which will push investors from electronic, and retail sector (to invest here),” he says.
The AJCEP agreement was signed by ASEAN and Japan on April 14, 2008. Japan is currently ASEAN’s fourth largest trading partner and the second largest external source of foreign direct investment.
In 2017, trade between ASEAN and Japan reached $219 billion, accounting for 8.5 percent of the region’s trade whereas FDI flows to ASEAN from Japan totalled $13.4 billion, representing 9.9 percent of the total FDI.
Business Writer, Capital Cambodia