Western analysts view Asia’s Regional Comprehensive Economic Partnership (RCEP) as a Chinese victory against Washington’s efforts to isolate it. Far more important are the implications for China’s economy.
The RCEP and the free trade agreements that China wants to conclude with its major trading partners portend an epochal change in Chinese governance. Together with Beijing’s decision to allow state-owned enterprises to default on bond market debt and take the consequences, the free trade measures are aimed at China’s productivity sink among state-owned enterprises.
There’s something of the world-turned-upside-down in the frenetic pace of China’s trade offensive. For years, China’s trading partners complained that China shielded its domestic market from foreign competition while persuading other countries to open their markets to Chinese goods.