It's the world's biggest trade deal most people have never heard of. New Zealand and 14 other countries from the Asia Pacific region are set to sign a new major trade agreement this weekend - the Regional Comprehensive Economic Partnership (RCEP).
The Regional Comprehensive Economic Partnership encompasses Japan, China, South Korea, the 10 members of the Association of Southeast Asian Nations (ASEAN), Australia and New Zealand. File image. Photo: Unsplash / Cytonn Photography
It encompasses Japan, China, South Korea, the 10 members of the Association of Southeast Asian Nations (ASEAN), Australia and New Zealand, creating a free trade zone, which covers nearly a third of the world's trade and economic output.
New Zealand already has individual trade deals with many of the RCEP signatories, and is bound to others through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) deal of a couple of years ago.
International Business Forum trade analyst Stephen Jacobi said that did not mean RCEP would not benefit this country.
"What we would look to from RCEP is to expand some commitments or bring them into line in some way, trying to harmonise them. It's a chance to wrap up in one agreement that exist in several."
India bows out
India was involved when RCEP talks began in 2013 but withdrew last year it would bow out, as the government there voiced concerns that opening up its market would cause its trade deficit with China to grow. Indian milk producers also feared major producers such as New Zealand and Australia might also gain access to their domestic market.
Stephen Jacobi. Photo: supplied
The agreement has left a door open for India to join at some later date, but Jacobi said its absence would be a dampener on the agreement, not least because it's a major economy that New Zealand does not have a trade deal with.
"That is a diminished opportunity because India is the only one with which we don't have an FTA (free trade agreement) and we'd very like an FTA with them, there's a lot we could do with great country.
"But India has also not associated with such a trade agreement and this type of rule making and having India as an outlier isn't very good, either for the world or I think India."
Jacobi said New Zealand's trade priorities are now to conclude deals with Britain and the European Union in the aftermath of Brexit. The former had started cordially he said, but the EU talks were proving more testing.
After that the country needed to look for new trade opportunities in new regions.
"They'll be in parts of the world we're not so aware of like Africa, Eurasia ... these are parts of the world we have traditionally not had trade relations and we need to start the long process of warming them up."
He said his group would be doing research next year on new trade opportunities and would the results to the government.