What is the significance of RCEP excluding the US for Apec?

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RCEP's Exclusion of the US Carves a New Trade Bloc, Potentially Diminishing Apec's Central Role

The recent signing of the Regional Comprehensive Economic Partnership (RCEP), a free trade agreement championed by China and notably excluding the United States, carries significant implications for the Asia-Pacific Economic Cooperation (Apec) forum. With 15 participating nations, a dozen of which are also Apec members, RCEP represents the formation of the world's largest free trade region. This development occurs as US President Donald Trump has opted to skip the virtual Apec summit hosted by Malaysia, further highlighting a divergence in trade priorities and potentially reducing Apec's influence as the primary platform for regional economic integration.
RCEP Establishes a Major China-Led Trade Framework

RCEP, signed by countries including China, Japan, South Korea, Australia, New Zealand, and the 10 ASEAN nations, aims to reduce tariffs, streamline customs procedures, and establish common rules for trade and investment. The agreement is expected to boost intra-regional trade and supply chain integration, with projections suggesting a substantial increase in global GDP and trade volumes in the coming years. By creating a unified trade bloc that encompasses a significant portion of the global economy, RCEP solidifies China's economic leadership in the region and provides a preferential trading environment for its participants.
US Absence from RCEP Underscores Trade Policy Divergence

The exclusion of the United States from RCEP stems from its prior withdrawal from the Trans-Pacific Partnership (TPP), a trade agreement that included many of the same countries but was seen as more comprehensive and with stronger labor and environmental provisions. The Trump administration's "America First" policy and its skepticism towards multilateral trade agreements contributed to this absence. While the US has stated its commitment to free and fair trade, its non-participation in RCEP, especially in contrast to China's prominent role, signals a shift away from broad, US-led regional trade frameworks.
Apec Faces Challenges to Its Relevance Amidst RCEP's Rise

The emergence of RCEP, coupled with the absence of a high-level US delegation at the Apec summit, raises questions about Apec's future relevance and effectiveness. Apec has recently faced significant hurdles, including the cancellation of its 2019 summit in Chile due to civil unrest and the unprecedented failure to agree on a joint communique in 2018, largely due to trade disputes between the US and China. Disagreements among Apec members regarding the "level of ambition" for multilateral trade and economic integration further complicate its path forward, suggesting a potential fragmentation of regional economic governance.

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What is the significance of RCEP excluding the US for Apec?

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