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Asia’s future as a global tech powerhouse hinges on China-Japan relations

  • Unlike in Europe, the legacies of the Pacific War have not been resolved in Asia, preventing greater economic integration
  • RCEP cements the region’s claim as the heart of the global production network, and could help its tech leaders clinch the free trade deal that has eluded them

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A mock-up of a Comac C919 aircraft cockpit at the Comac Shanghai Research and Development Centre in Shanghai in 2017. With a sustained US-China power rivalry ahead, China must leverage its neighbours’ technologies more effectively. Photo: Bloomberg

Hailed as the largest regional trading bloc in the world, the real significance of the Regional Comprehensive Economic Partnership (RCEP) goes beyond trade. Instead of the often-discussed “wins” for China, Japan could perhaps gain the most from RCEP.

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It may be a peaceful materialisation, under a vastly different world order, of the notorious Greater East Asia Co-prosperity Sphere once aggressively promoted by Imperial Japan.

As the Association of Southeast Asian Nations has free trade agreements with all the other RCEP members, the bloc is arguably the consolidation and rationalisation of all these Asean FTAs. There are also FTAs among most of the other RCEP countries. So what is the big deal about RCEP?

Conspicuously absent among existing FTAs in the Asia-Pacific are any between Japan and its two most important neighbours, China and South Korea. The reasons are historic. Unlike Europe, the legacies of the Pacific War and Japan’s colonisation of Korea have not been completely resolved.

It took smaller countries, many of which also suffered from Japanese aggression, to help overcome the deep-rooted animosity between Japan and its two key neighbours within the framework of a larger agreement.

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RCEP: 15 Asia-Pacific countries sign world’s largest free-trade deal

RCEP: 15 Asia-Pacific countries sign world’s largest free-trade deal
Unlike the European Union, there are deep political divisions within RCEP. Japan and South Korea are staunch US allies. Soon after RECP was signed, Japan and Australia came to an agreement on a mutual defence pact.
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