Chongqing - The Regional Comprehensive Economic Partnership (RCEP) agreement took effect on June 2 for the Philippines, marking that the RCEP agreement is now in effect for all 15 signatory members. 

"Under the complex global economic and trade landscape, the comprehensive implementation of RCEP reflects the ambitions of multiple parties to expand the international market and promote high-quality development," said Deng Jing, deputy director and researcher at the Institute of International Economic and Trade and Logistics, Chongqing Academy of Social Sciences. 

"For China, RCEP presents a favorable opportunity to enhance its openness, optimize its economic and trade structure, and innovate open rules," he added.

The first RCEP certificate of origin to the Philippines 

On the day when RCEP became effective for the Philippines, Lianglu Cuntan Customs District in Southwest China's Chongqing issued the first RCEP certificate of origin for goods worth 250,000 yuan (about USD 35,081 ) exported to the Philippines by Chongqing Senci Import & Export Trade Co., Ltd.

The certificate of origin shall be issued by the Issuing Authority of the exporting Party upon application by the exporter, manufacturer, or authorized representative. With this certificate, this batch of goods can enjoy zero tariffs in the Philippines.

The company, a subsidiary of Chongqing Senci Group and a leading player in Chongqing's power generation industry, annually exports a significant volume of machinery and equipment, including generators, and high-pressure washers, to the ASEAN region. Its exports to the Philippines alone surpass seven million yuan annually.

Xiao Hong, foreign trade manager of Chongqing Senci Import & Export Trade Co., Ltd., said that before the RCEP agreement implementation, Philippine customers could only obtain import tariff benefits through the China-ASEAN Free Trade Agreement Certificate of Origin, which still helped the firm save over three million yuan in tariff costs for goods.

"With the RCEP in effect for the Philippines, we now have an additional preferential option for exports," he said. "A wider range of export products can enjoy the tariff benefits of the free trade agreement, which plays an important role in expanding our overseas market."

According to Xiao, customers can choose a more favorable certificate of origin based on the tariff reduction on Chinese goods in the Philippines, thereby lowering import costs.

This local company can also target manufacturing clients and promote its competitive components, leading to meaningful opportunities for expanding sales channels and enhancing market share. 

Potential collaboration with RCEP countries in technical innovation

As the RCEP is fully implemented, tariffs on over 90% of goods exchanged between member countries will gradually be eliminated. Deng believes that Chongqing can utilize the resource advantages of RCEP member countries to expand its international economic influence.

For example,  Chongqing can forge stronger technological partnerships with countries like Japan, South Korea, and Australia, bolstering its innovation capabilities. Deng said these countries possess advanced technologies, while Chongqing has a solid industrial foundation and ample market space.

"The RCEP framework facilitates evident complementarity between two sides," he added. "RCEP's full implementation lowers cooperation costs for member countries."

By establishing industrial parks and engaging in project collaborations, Chongqing can extend the industrial chains of sectors to ASEAN countries, including electronic information and intelligent connected new energy vehicles, automobiles, and parts. 

This development will enable firms to optimize their industrial layout in countries and regions such as Japan, South Korea, and ASEAN, further strengthening their competitive position in the global market, said the head of Chongqing Customs District. 

The policy dividends released by the RCEP are continuously emerging, effectively helping companies expand markets, reduce costs, and improve efficiency. 

Statistics show 979 RCEP certificates of origin with an amount of 479 million yuan were issued in 2022 in the Chongqing Customs District. From January to May, Chongqing Customs District issued RCEP certificates of origin worth around 330 million yuan, a year-on-year increase of 48.05%. 

Simultaneously, the value of imported goods benefiting from RCEP amounted to 88 million yuan, resulting in tariff reductions of 1.58 million yuan. These figures represent remarkable year-on-year growth rates of 317.15% and 217.25%, respectively.