South Korean President Moon Jae-in yesterday mooted the idea of his country entering the revised Trans-Pacific Partnership trade deal, joining China in expressing interest in a pact that Japan is credited for leading to fruition.
He discussed the idea at a trade-related event, stressing the importance of diversifying the country's export market to drive growth in the pandemic-hit economy.
South Korea's Yonhap News Agency said this was the first time Mr Moon had publicly discussed the idea, though Japan's Nikkei newspaper noted that Mr Moon's predecessor Park Geun-hye had shown interest in the deal as early as in 2013.
"Diversifying the market is a task that (we) should achieve," Mr Moon said, adding that his government will "continue to review joining" the pact known formally as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
He stressed that the "strongest weapon" against protectionism was global competitiveness in producing good products.
The 11-nation CPTPP, comprising Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, covers 500 million people and 13 per cent of the global economy.
Former Japanese prime minister Shinzo Abe has been credited for leading the deal to completion after the pull-out by US President Donald Trump. The deal is now in effect, having been ratified by seven signatories.
It has far more stringent terms in areas such as market access and intellectual property than the 15-member Regional Comprehensive Economic Partnership deal inked last month, comprising the 10 Asean states as well as Australia, China, Japan, New Zealand and South Korea. The bloc covers 30 per cent of the global economy.
This is why there has been healthy scepticism over the viability of China joining the CPTPP.
Chinese President Xi Jinping said at the Asia-Pacific Economic Cooperation summit last month that the group "must continue to promote regional economic integration and establish an Asia-Pacific free trade zone at an early date". He said China "will actively consider joining" the CPTPP.
But Japanese Foreign Minister Toshimitsu Motegi said that while Tokyo welcomes the interest, this needs further assessment according to the pact's rules.
Keio University economist Fukunari Kimura thinks the barriers are high for China to join the CPTPP, and many exceptions might have to be made to allow its participation. He told a webinar on free trade for foreign journalists in Tokyo: "Generally speaking, for China to comply with the requirements under the CPTTP, it will have to undertake domestic reforms that are extremely difficult."
These areas include market access through the elimination of tariffs and the liberalisation of service investments, as well as rules governing e-commerce and state-owned enterprises, he added.
He also doubted there will be an immediate return to the trade deal by the US under President-elect Joe Biden, given that any such plan will be politically difficult.
Meanwhile, other economies, including Taiwan and Britain, had previously expressed interest in joining the CPTPP.
Dr Kimura said CPTPP member states will see benefits in South Korea - the world's ninth-largest economy, according to forecasts this year - joining the partnership, given that "its inclusion will further reinforce the coalition of middle powers".