On January 1, 2022, the Regional Comprehensive Economic Partnership (RCEP) agreement took effect in 10 of the 15 signatory countries, including China, Japan, New Zealand, Australia, Brunei, Cambodia, Laos, Singapore, Thailand, and Vietnam.
The Zoomlion Heavy Industry Science and Technology Co., Ltd. (Zoomlion) became the agreement’s first beneficiary among enterprises in Changsha. On January 4, 2022, the first working day of the new year, Xingsha Customs issued Changsha's first RCEP certificate of origin for Zoomlion's excavators exported to Thailand, with a value of 542,600 US dollars. The certificate is expected to reduce tariffs for the enterprise by 27,000 US dollars.
The agreement has created a free trade bloc covering the largest population, the most diverse membership and with the greatest development potential. This will be beneficial to Hunan's construction machinery, automobile, electronic information, chemical industry, non-ferrous metals, food processing, large-scale consumption and other fields. This will also help Hunan to build itself into a new hub for opening-up and development in inland areas. Hunan's foreign trade will usher in a good thriving situation.
Yang Yi, director of the Comprehensive Business Division 1 of Xingsha Customs, said that, the implementation of the agreement will significantly promote the in-depth integration of Changsha's advantageous industries such as construction machinery, automobile manufacturing, and advanced technology in the RCEP region, and reduce the procurement costs of resource products in such industries as chemicals, non-ferrous metals, and food processing. Meanwhile, the export of steel, shoes, ceramics, agricultural products and other products will also embrace new opportunities. For instance, Changsha’s automobile manufacturers import auto parts from Japan and other RCEP signatory countries for whole-vehicle production. With the agreement in effect, the procurement cost will be significantly reduced, and the average tariff rate will be down by 1% to 2%.
Taking Changsha’s foreign trade data during the January-November period in 2021 as an example, with the implementation of the RCEP, Changsha’s imported goods are estimated to enjoy about 1.28 billion yuan of tariff reductions a year, and its exported goods are estimated to receive preferential tariff treatments worth about 19.73 million US dollars from RCEP signatory countries.
The RCEP agreement reduces the cost of tariffs on cross-border trade among RCEP signatory countries, with the biggest impact on traditional high-tax sectors such as food, agriculture, consumer goods, and automobiles. In the future, Changsha people will have more options for imported food. Changsha consumers will buy Japanese cars, Australian skin care products, New Zealand honey, and Malaysian fruit at a cheaper price. In addition, business, labor and tourism exchanges within the RCEP region will be more smooth.
Source: en.changsha.gov.cn