The Comprehensive Economic Partnership for East ASIA (CEPEA) is a Japan

Japan

Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...

ese led proposal for trade co-operation, free trade agreement, among the 16 present member countries of the East Asia Summit

East Asia Summit

The East Asia Summit is a forum held annually by leaders of, initially, 16 countries in the East Asian region. Membership will expand to 18 countries including the United States and Russia at the Sixth EAS in 2011. EAS meetings are held after annual ASEAN leaders’ meetings...

.

Countries involved

The 16 countries are:

• the 10 members of ASEAN
• plus the three additional members of ASEAN Plus Three
• plus

Background

The concept has been in discussion stages since 2006 but gained momentum in 2008 and 2009 when India

India

India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...

 and ASEAN; and Australia

Australia

Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...

, New Zealand

New Zealand

New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...

 and ASEAN respectively concluded free trade agreements.

The CEPEA proposal was advanced by Japan in conjunction with the establishment of the Economic Research Institute for ASEAN and East Asia

Economic Research Institute for ASEAN and East Asia

The Economic Research Institute for ASEAN and East Asia or ERIA is a policy think tank proposed by Japan arising out of the East Asia Summit, proposed at the Second EAS and approved at the Third EAS. ERIA aims; to facilitate ASEAN Economic Community building; to support ASEAN's role as the driver...

 (ERIA). The two mechanisms are designed to be mutually supporting liberalisation and co-operation.

The details of the concept and its relationship with other proposals for the region, such as the East Asian Community

East Asian Community

East Asian Community is a proposed trade bloc for the East Asia countries that may arise out of either ASEAN Plus Three or the East Asia Summit .- Prior to the EAS :...

, remain unclear. An alternative proposal based on the 13 members of the ASEAN Plus Three is called the East Asia Free Trade Agreement (EAFTA).

The Third East Asia Summit

Third East Asia Summit

The Third East Asia Summit was the third meeting of the East Asia Summit held in November 2007. The EAS is a pan-Asia forum held annually by the leaders of 16 countries in the East Asian region...

 agreed that a final report on the CEPEA proposal was to be received at the Fourth East Asia Summit which was held in October 2009.

The Chairman's Report for the Fourth East Asia Summit (25 October 2009) stated:

19.We noted the final Phase II Report of the Track Two Study Group on
Comprehensive Economic Partnership in East Asia (CEPEA) and
welcomed the decision of our Economic Ministers who met in Bangkok
on 15 August 2009 to task the Senior Economic Officials to discuss and
consider the recommendations in the Phase I and II reports. CEPEA and
East Asia Free Trade Area (EAFTA) could be examined and considered
in parallel.

The report for the ASEAN Plus Three meeting, held the day before with 13 of 16 of the same members, also stated:

13.We noted the final report of the Phase II feasibility study of the East Asia
Free Trade Area (EAFTA) and welcomed the decision of 12th AEM Plus
Three Consultations in Bangkok on 15 August 2009 to task the Senior
Economic Officials to discuss and consider the recommendations in the Phase
I and II reports. EAFTA and Comprehensive Economic Partnership in East
Asia (CEPEA) could be examined and considered in parallel.

The Chairman's Statement of the 16th ASEAN Summit

ASEAN Summit

The ASEAN Summit is an annual meeting held by the member of the Association of Southeast Asian Nations in relation to economic, and cultural development of Southeast Asian countries....

 (9 April 2010) stated:

30. We noted the initiatives being undertaken to take forward broader regional integration by considering the recommendations of both East Asia Free Trade Agreement (EAFTA) and the Comprehensive Economic Partnership for East Asia (CEPEA) studies together. We looked forward to receiving the progress report at the 17th ASEAN Summit in October 2010 and to discussing with our Dialogue Partners the future direction of regional architecture with ASEAN at its core.

By August 2010 working groups involving the 16 nations to study Economic Cooperation, Rules of Origin, Customs Procedures and Tariff Nomenclature had been formed.

East Asia Free Trade Agreement

13 of the 16 nations (excluding India, Australia and New Zealand) are also simultaneously negotiating an East Asia Free Trade Area.

The two processes are not alternatives and both are being pursued simultaneously

Current arrangements

The 16 members are presently involved in a series of separate arrangements among the members of the grouping. The 10 members ASEAN have established the ASEAN Free Trade Area

ASEAN Free Trade Area

ASEAN Free Trade Area is a trade bloc agreement by the Association of Southeast Asian Nations supporting local manufacturing in all ASEAN countries....

. Australia and New Zealand have the long established Closer Economic Relations

Closer Economic Relations

Closer Economic Relations is a free trade agreement between the governments of New Zealand and Australia. It is also known as the Australia New Zealand Closer Economic Relations Trade Agreement and sometimes shortened to...

.

Between the 16 members bilateral and multilateral arrangements are in place or under negotiation.

ASEAN has the following arrangements in place:

• • the ASEAN–China Free Trade Area
    ASEAN–China Free Trade Area
    The ASEAN–China Free Trade Area , also known as the China–ASEAN Free Trade Area is a free trade area among the ten member states of the Association of Southeast Asian Nations and the People's Republic of China...
    
     came into force on 1 January 2010;
  • a comprehensive economic partnership agreement with Japan came into force on 1 December 2008;
  • the ASEAN Korea Free Trade Agreement, the trade in goods provisions came into effect on 1 June 2007, an agreement for trade in services was signed in 2007 and the trade in investments provisions were signed in 2009;
  • a free trade agreement with Australian and New Zealand (jointly) AANZFTA that came into force on 1 January 2010;
  • the ASEAN-India Trade in Goods (TIG) Agreement came into effect on 1 January 2010 and the ASEAN-India Trade in Services and Investment Agreements are still under negotiation;

plus China, Japan and South Korea are researching (as at October 2009) a joint arrangement between the three countries with talks hoped to commence in 2012;

plus

China has the following additional arrangements in place:

• • negotiations are said to be announced to commence shortly (as at April 2010) with South Korea on an arrangement;
  • negotiations with Australia on an arrangement;
  • the New Zealand – China Free Trade Agreement came into force 1 October 2008;
  • a feasibility study on an arrangement with India was positively concluded in 2007;

plus

Japan has the following additional arrangements in place:

• • negotiations with South Korea on an arrangement but which have been suspended since 2004;
  • negotiations with Australia on an arrangement;
  • negotiations with India on an arrangement;
  • conducting a feasibility study with New Zealand as of (14 May 2008)

plus

South Korea has the following additional arrangements in place:

• • negotiations with Australia on an arrangement;
  • negotiations with New Zealand on an arrangement ;
  • India and South Korea signed a comprehensive economic partnership agreement in August 2009;

plus

Australia has the following additional arrangements in place:

• • as noted above Closer Economic Relations
    Closer Economic Relations
    Closer Economic Relations is a free trade agreement between the governments of New Zealand and Australia. It is also known as the Australia New Zealand Closer Economic Relations Trade Agreement and sometimes shortened to...
    
    with New Zealand;
  • a feasibility study with India about entry into an arrangement;

plus

India has the following additional arrangements in place:

• • a feasibility study with New Zealand about entry into an arrangement;

plus

multiple additional bilateral arrangements between one or more ASEAN members separately.

In addition individual members of ASEAN may also have other arrangements in place beyond the arrangements negotiated by ASEAN as a bloc i.e., Singapore by itself outside of ASEAN has a series of FTAs.

Overview of current arrangements

The current status is summarised below.

	ASEAN	China	Japan	South Korea	Australia	New Zealand	India
ASEAN		Concluded	Concluded	Concluded	Concluded	Concluded	Largely Concluded
China	Concluded		Proposed with South Korea	Proposed with Japan or bilateral	Negotiating	Concluded	Proposed
Japan	Concluded	Proposed with South Korea		Proposed with China bilateral suspended	Negotiating	Feasibility Study	Concluded
South Korea	Concluded	Proposed with Japan or bilateral	Proposed with China bilateral suspended		Negotiating	Negotiating	Concluded
Australia	Concluded	Negotiating	Negotiating	Negotiating		Concluded	Negotiating
New Zealand	Concluded	Concluded	Feasibility Study	Negotiating	Concluded		Negotiating
India	Concluded	Proposed	Concluded	Concluded	Negotiating	Negotiating