I am pleased to share with you a
special issue of UNCTAD’s Global Investment Trends Monitor focusing on the implications of the RCEP agreement for investment flows in the region.
Key findings include:
The Regional Comprehensive Economic Partnership (RCEP) agreement, signed on 15 November 2020, could give a significant boost to foreign direct investment (FDI) in the mega region.
The investment provisions in the agreement mostly consolidate existing entry commitments and best practices of investment facilitation contained in myriad bilateral and subregional agreements. However, the provisions related to market access and disciplines
in trade, services and e-commerce are highly relevant for regional value chains and market-seeking investment.
RCEP is already a major FDI destination. It accounts for 16% of global FDI stock and more than 24% of flows. While global FDI has been stagnant for the last decade, the RCEP group has shown a consistent upward trend until last year.
The agreement comes at a time of major upheaval caused by COVID-19. The pandemic will lead to a drop in FDI in the region of about 15%. However, this compares favourably to a fall of 30-40% in global FDI, and the region looks set to lead the FDI recovery.
Intra-regional investment, at about 30% of total FDI in RCEP, has significant room for further growth. It is relatively low compared to other major economic partnerships.
Likely investment policy priorities for the partnership will include: (i) Boosting investment in sustainable post-pandemic recovery; (ii) Supporting resilience-seeking FDI, and (iii) Promoting investment for development.
A special issue of the SDG Investment Trends Monitor on the impact of COVID-19 on investment in the SDGs will be published in December. The next regular issue of the Global Investment Trends
Monitor is scheduled for mid-January 2021.