The signing of the Regional Comprehensive Economic Partnership marks the official start of a free trade zone with the largest population in the world, the most diverse member structure, and the greatest development potential in history.
The various trade protection brought by RCEP among the 15 countries is a cardiotonic, will boost many industries such as light industry, building materials, textiles and clothing, and e-commerce. For the domestic home furnishing industry, the export market may stage a new rising.
Enterprises with a High Proportion of Exports will be the First to Benefit
In fact, the pan-Asian market, which has a high degree of overlap with the signatory countries, is a very large consumer market for household products.
Data shows that in 2019, furniture consumption in the Asia-Pacific region (including China, Japan, South Korea, Southeast Asia, Australia, New Zealand, etc.) was US$20.2 billion, accounting for 42% of the global furniture industry consumption. Among them, Japan and South Korea rely heavily on imported furniture.
As a major home production and furniture exporting country, China provides consumers in the Asia-Pacific market with a wealth of home furnishing products.
As the RCEP starts to operate, Chinese export volume on Home Furnishings in these areas is expected to take a higher level. One of the most important aspects of RCEP cooperation is that the overall openness in trade in goods reaches more than 90%, and tariff reductions among members are based on the commitment to reduce to zero tariffs immediately and within ten years.
Previously, ASEAN, Japan, South Korea, and New Zealand imposed tariffs on domestic household exports between 3% and 5%. After the RCEP is signed, this part of the tax point may be gradually reduced or even "zero tariff."
In recent years, domestic companies increase their investment in environmental protection, the cost of various energy sources and labor have risen, which means export costs become higher. If the signing of RCEP can save 3% to 5% tariffs, it will definitely help improve corporate profits and promote a new peak in exports.
*The new is extracted from and original published on sino-manager.com, all rights belong to it.
Post time: Nov-25-2020
