Brunei Darussalam’s active engagement of free trade agreements (FTAs) provides various benefits for local businesses which will also spur economic growth.
Through FTAs, local businesses can enjoy the reduction or elimination of tariffs. This will reduce trade transaction costs as a whole and will lead to cheaper prices of goods, while also promoting free flow of goods in the region thus allowing local businesses to expand in a larger scale. With cheaper costs to promote and sell their products, local businesses have the opportunity to enter foreign markets.
Local businesses can enjoy the benefits of FTAs by using a Certificate of Origin upon submitting their supporting documents.A Certificate of Origin is a document that certifies the origin of the goods imported to any country, issued by the Trade Facilitation and Promotion Division, Ministry of Finance and Economy.
Brunei Darussalam ratified the Regional Comprehensive Economic Partnership (RCEP) agreement upon depositing its instrument of ratification with the Secretary-General of ASEAN on October 11, 2021.
The timely ratification signals Brunei’s strong commitment to supporting the region’s postpandemic recovery efforts, strengthening economic and trade linkages, creating new opportunities for businesses as well as support for an open, inclusive, rules-based multilateral trading system.
The RCEP agreement was signed virtually at the 4th RCEP Summit on November 15, 2020 by ASEAN member states – Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam – and ASEAN dialogue partners Australia, China, Japan, Korea and New Zealand.
Launched in 2012, the eight-year negotiated agreement establishes a mutually beneficial economic partnership between ASEAN and its FTA partners. It is the world’s largest regional FTA comprising about 30 per cent of global gross domestic product (GDP) and about a third of the world’s population. Brunei Darussalam is expected to benefit from the RCEP as it will broaden and deepen the economic ties between the members and provide new opportunities for producers and businesses, especially in terms of market access given the level of liberalisation for trade in goods, services and investment.
On January 1, 2022, the agreement entered into force for Australia, Brunei Darussalam, Cambodia, China, Japan, Laos, New Zealand, Singapore, Thailand and Vietnam. The agreement entered into force in Korea on February 1. As for the remaining signatory states, the RCEP agreement will enter into force 60 days after the deposit of their respective instrument of ratification, acceptance, or approval to the Secretary-General of ASEAN.
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