Foreign trade businesses reap rewards of RCEP

In less than a year since the Regional Comprehensive Economic Partnership took effect, foreign trade businesses in Shanxi have reaped the benefits from this regional trade assistance program for Southeast Asia, East Asia and Oceania.

The RCEP came into effect on Jan 1 after agreements were achieved among six Association of Southeast Asian Nations members — Brunei, Cambodia, Laos, Singapore, Thailand and Vietnam — as well as four non-ASEAN signatory states: China, Japan, Australia and New Zealand.

For Yongdong Chemicals, an exporter of carbon black, based in the city of Yuncheng, its direct gain from the initiative is the reduced tariff resulting from the RCEP certificate of origin. Carbon black is a material produced by the incomplete combustion of coal and coal tar, vegetable matter, or petroleum products.

"With this certificate issued by Yuncheng Customs, the tariff imposed on our exports to Japan has been reduced from 3.9 percent to 3.5 percent," said Chen Qian, an executive of Yongdong Chemicals. "The decreased tariff will surely lead to increasing competitiveness of our products in Japan."

She added that there will be a steady decrease in the rate in the years to come until the tariff reaches zero in the 11th year.

The executive said her company has been granted a total 83 such certificates since January for goods with value totaling $19.12 million.

"Boosted by this new practice, we saw our export prices rise about 10 percent from 2021," Chen said.

Yu Wenfang, an official at Taiyuan Customs, said that she noticed the RCEP certificate of origin is favored in the Japanese market.

"Japan is the largest destination market for exports with an RCEP certificate of origin," Yu said. "We granted 997 such certificates for products exported to the Japanese market during the first three quarters, with a total value of $67.31 million."

During the first 10 months of this year, Taiyuan Customs issued 1,214 RCEP certificates of origin for exports totaling $76.3 million. It also handled 128 million yuan ($18.44 million) worth of imported goods with such certificates from overseas.

Some industry-leading companies in Shanxi have the autonomy to produce certificates of origin themselves.

Huaxiang Group, a household appliance manufacturer and exporter based in the city of Linfen, was the first company in Shanxi authorized to issue such certificates.

"Since the beginning of this year, our company has issued 37 certificates for goods amounting to 6.73 million yuan," said Wang Zhifang, general manager of Huaxiang Group.

According to Yu of Taiyuan Customs, the autonomy of issuance is usually granted to enterprises with long-term experience in international trade and their own strict quality control system.