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Lawmakers also ratified a bilateral trade pact with South Korea,
hoping to attract investment to develop the electric vehicle and
batteries industry in the Southeast Asian country.
Indonesian Trade Minister Zulkifli Hasan said the RCEP would
boost trade, direct investment and increase the country's GDP
growth by 0.07 percentage point.
"We describe this agreement as a toll way to enter the global
market, and it is time for Indonesia to storm the international
markets," he told lawmakers.
The RCEP, which is seen as an alternative to the U.S.-led
Comprehensive and Progressive Agreement for Trans-Pacific
Partnership (CPTPP), covers nearly a third of the world's
population and about 30% of its gross domestic product. It was
initially agreed by leaders of 15 Asia-Pacific countries in
November 2020.
The pact, which does not include the United States, entered into
force on Jan. 1 this year after seven nations in Southeast Asia,
and Australia, China, Japan, and New Zealand ratified the pact
last year.
Under the agreement with South Korea, Jakarta and Seoul will
eliminate more than 92% and 95% of tariff lines respectively.
Indonesia will give preferential tariffs to support Korean
investment in areas ranging from automobiles to apparel,
Indonesia's Trade Ministry said in a statement following the
deal signing in 2020.
South Korean companies such as Hyundai Motor Group and LG Energy
Solution are currently among top investors in the electric
vehicle and battery industry in Indonesia as it looks to take
advantage of its rich nickel reserves.
(Reporting by Stefanno Sulaiman and Fransiska Nangoy; Editing by
Kanupriya Kapoor)
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