Singapore, Aug 29: Talks on a China-backed free-trade pact have reached a "critical stage", Singapore's leader said today as he urged regional economic ministers to seal the deal by the end of the year.
The 16-nation Regional Comprehensive Economic Partnership (RCEP), which will be the world's biggest free-trade accord if it is agreed, has taken centre stage as Washington embarks on a unilateral, protectionist agenda.
Covering about half the world's population, the RCEP notably excludes the US, which had been leading another regional pact -- the Trans-Pacific Partnership (TPP) -- until President Donald Trump abandoned it on coming to the office early last year.
"The RCEP negotiations have continued for some time, and have now reached a critical stage," Prime Minister Lee Hsien Loong said as he opened a five-day meeting of economy ministers from the Association of Southeast Asian Nations (ASEAN).
The Singapore meeting will be joined later in the week by top trade officials from ASEAN's main trading partners, including China, Japan, Australia and the US. "After a great deal of work, the possibility of substantively concluding the RCEP negotiations is finally in sight," he said.
Lee also warned about escalating tensions between the US and China -- who have been locked in a spiralling trade row -- and other major economies including the eurozone and Canada.
"The RCEP will be an important signal to the world that ASEAN members and our partners place a high value on free trade, regional integration and international cooperation," he said.
The pact will group the 10 ASEAN members plus China, India, Japan, South Korea, Australia and New Zealand, and will cover a third of the world's gross domestic product.
A diplomatic source said Singapore, this year's ASEAN chair, is pushing for an agreement on the RCEP before handing over the chairmanship to Thailand in 2019.
Another source involved in the talks said ASEAN leaders hope to announce the "substantial conclusion" of negotiations during a summit in November with their main trading partners, and they expect the pact to be implemented in 2020.
Beijing is keen to use Washington's rejection of the TPP to build enthusiasm for its own deal and increase influence in the region. RCEP is a more modest deal that prescribes lower and more limited regulatory standards. The 11 remaining TPP members signed a slimmed down version of the agreement in March.