Li Keqiang

Li Keqiang pushes for Asian free trade pact inside two years

Premier urges regional co-operation to build a 'bigger and better economy', while expressing concern over threat of debt default by the US

PUBLISHED : Friday, 11 October, 2013, 12:00am
UPDATED : Friday, 11 October, 2013, 10:06am

Premier Li Keqiang has reaffirmed Beijing's desire to complete negotiations on a sweeping regional free trade pact within the next two years.

In separate speeches to two regional summits in Brunei yesterday, Li urged Asian nations to stick to their plan and complete talks on the Regional Comprehensive Economic Partnership (RCEP) by the end of 2015.

While attending the Association of Southeast Asian Nations (Asean) and the East Asia Summit in Bandar Seri Begawan, Li also raised concern about the prospect of the US defaulting on its debt, much of it held by China, Xinhua reported. Li mentioned his worries while meeting US Secretary of State John Kerry on the sidelines of the events.

Li's remarks about the RCEP deal reflected Beijing's ambition to play a big role in integrating the fast-growing Asia-Pacific region.

Those efforts were bolstered by the absence of US President Barack Obama, who was forced to stay in Washington because of continued wrangling over the federal government shutdown.

The RCEP talks include the 10-member Asean bloc and its six free trade partners, Australia, China, India, Japan, New Zealand and South Korea. The participants agreed in May to finalise the pact before 2016. "It has become the clear consensus among countries in the region to build a bigger and better economy by following the path of regional co-operation," Li told Asean nations.

The US is pushing its own regional free trade pact, the Trans-Pacific Partnership (TPP), which does not include China.

Stressing China's support for economic integration under the principals of openness, inclusiveness and transparency, Li suggested that there could be interaction between the RCEP and the TPP.

Li said China and East Asian nations must work to improve their mutual trust and unity, but remain cautious against interfering in the internal affairs of other nations. He offered a metaphor to illustrate the importance of co-operation.

"He whoever has had experience with chopsticks understands that one single chopstick won't do the work of putting food in the mouth," Li said. "To do the work, a pair of chopsticks are needed. And when a bunch of chopsticks are tied together, they won't break easily."

Observers said Li's push for the RCEP indicated Beijing's fear that its role in regional economic affairs might be diminished should the TPP be launched.

ANZ Bank's Raymond Yeung said: "By stressing the RCEP, Li sends a signal that China should be a player in regional economic affairs. The influence of the US in the region will be boosted when the TPP is done."

Yeung said it was possible the trade deal could be finalised in 2015, but added that Japan may be hesitant because of its own strained ties with China.

Beijing and Tokyo have been engaged in a diplomatic row over the disputed Diaoyu, or Senkaku, islands in the East China Sea.

Jin Canrong , an international affairs specialist in Renmin University, also said the finalisation of the deal "does not only depend on China". He said Japan may not be willing to fully open its industries for trade.

China's efforts to forge a regional trade deal have also been complicated by its territorial disputes with Asean nations in the South China Sea.

Li reiterated Beijing's desire to settle the matters through two-way talks and urged Southeast Asian nations to "mutually understand and respect" China.

Video:China premier calls for 'peace' in South China Sea