The BRI and RCEP: ensuring cooperation in the liberalisation of trade in Asia

Abstract

The Belt and Road Initiative (BRI) offers the prospect of trade integration between Asia and Europe. But it is subject to a number of risks, some of them are similar to those associated with the Trans-Pacific Partnership (TPP). East Asian trade liberalisation in the 1990s involved collaborative autonomy - a cooperative process of outward-looking unilateral liberalisation on a 'most favoured nation' (MFN) basis - rather than the creation of a regional free trade area. By contrast, the TPP has sought to create a free trade area, which would have led to trade diversion and have had other unsatisfactory features. The combination of BRI with the Regional Cooperation Economic Partnership (RCEP) might offer the possibility of outward-looking liberalisation, one which is neither dominated by China nor subject to the trade diversion of the TPP. This combination would bring strength and legitimacy to the BRI.