RCEP Signs To Unite Regional Development, Join Forces In Capital Market To Fulfill "Factor Allocation Post"

The big news heard over the weekend was fermented in the "confidence + information" stock market on Monday. On November 16, more than 70% of the stock markets (if any) of the member countries of the regional comprehensive economic partnership (RCEP) rose, and the Nikkei index continued to move forward on the basis of the 29 year high. The successful signing of RCEP shows the free trade consensus of 15 countries, and it is also a constructive expression to promote the development of the world economy. In this process, China's capital market will have a bright future.

On November 15, RCEP was officially signed during the series of leaders' meetings on East Asian cooperation. Premier Li Keqiang said that this is not only a highly symbolic achievement of regional cooperation in East Asia, but also a victory of multilateralism and free trade. RCEP will become an important engine for global growth.

The author believes that behind the double victory is the mutual complementarity of economic structure and industrial structure among RCEP members, and the efficient allocation of capital, technology and labor elements in the region. In this process, China's capital market can further play its pivotal role in the allocation of regional resources, elements and industrial structure.

First of all, the "close cooperation" between RCEP and China has been strengthened.

RCEP was initiated by 10 ASEAN countries and invited six dialogue partners including China, Japan, South Korea, Australia, New Zealand and India to participate. A total of 15 member states (excluding India) signed the agreement. At present, ASEAN, Japan and South Korea are China's largest, fourth and fifth largest trading partners.

This year, in the face of the impact of the epidemic on the global economy, China has taken the lead in controlling the epidemic and achieving economic recovery, helping countries in the region to hedge against the epidemic disturbance, and continuously contributing to the regional economic recovery in East Asia.

According to the data of the General Administration of customs, in the first 10 months of this year, the total trade value between China and ASEAN was 3.79 trillion yuan, an increase of 7%, accounting for 14.6% of the total foreign trade value. Among them, exports to ASEAN reached 2.11 trillion yuan, an increase of 7.3%; imports from ASEAN reached 1.68 trillion yuan, an increase of 6.6%. The total trade value between China and Japan was 1.8 trillion yuan, an increase of 1.5%, accounting for 6.9% of the total foreign trade value. Among them, exports to Japan were basically the same as the same period last year, and imports from Japan increased by 2.7%. The total trade value of China and South Korea was 1.62 trillion yuan, an increase of 0.8%, accounting for 6.2% of the total foreign trade value. Among them, exports to South Korea increased by 1.4%, and imports from South Korea increased by 0.4%.

Secondly, China's economy is the engine of economic growth in East Asia, and the high-quality development of China's economy will produce huge spillover effect and "chemical reaction" in the region covered by RCEP.

The economic structure of RCEP member countries is highly complementary, and the capital, technology and labor elements are complete in the region. The signing of RCEP will further relax the market access of goods, services, investment and other fields among Member States, and gradually unify the rules of origin, customs procedures, inspection and quarantine, and technical standards. It will promote the free flow of economic factors in the region, strengthen the division of production and division of labor among its members, and promote the expansion and upgrading of the regional consumption market.

Due to its strong market and abundant production capacity, China is in a pivotal position in the economic development of RCEP member countries, and China's economy is in the stage of high-quality development. With the rapid increase of demand for advanced technology, elements and service trade, it can produce multi-dimensional, multi coverage and multi adaptability value spillovers, so as to promote the regional industrial chain, supply chain and value chain Further integration and development.

Third, with the signing of RCEP, China's capital market is expected to become the "key dispatcher" in the allocation of capital elements and technical elements.

The capital market is the "barometer" of the national economy, and the listed companies are the best "constituent stocks" of China's economy. At present, the total market value of China's stock market exceeds 70 trillion yuan, accounting for 70% of domestic GDP. In recent years, the capital market has played an important role in the allocation of factor resources, policy transmission, risk prevention and mitigation, and expectation guidance. It has promoted the integration of science and technology and capital, and injected new momentum into the quality and efficiency improvement of the real economy.

On the one hand, the core measures of signing RCEP this time include gradual tariff reduction. In this process, we need to give better play to the supply and capacity advantages of China's advanced manufacturing industry. These high-quality supply and capacity are largely from the existing listed companies and the companies to be listed in the capital market which are open to welcome. The capital market can be further innovated and play its role in the allocation of production factor resources.

On the other hand, capital market can provide more smooth investment channels and development stage for foreign capital. The reform of the capital market and the improvement of the quality of the capital market are deeply affected by the reform of the capital system and the capital market. This kind of allocation ability is not limited to the pivot force of China's economy and domestic capital, but also guides the flow of regional economy and foreign capital and provides risk aversion services. Since the beginning of this year, China has gained more foreign capital.

In the logic of regional economic progress, in the trend of trade cooperation development. The author believes that it is China's commitment to RCEP and the capital market's responsibility to play a pivotal role and promote the regional economic development covered by RCEP.