Rail service market updates | July 2021

APAC countries signed world's largest free trade agreement

On November 15, 2020, leaders from 15 Asia Pacific nations came to an agreement to form a free trade bloc under the Regional Comprehensive Economic Partnership (RCEP). The agreement is intended to facilitate trades among the member countries by removing tariffs and stimulate the economy amid the COVID-19 pandemic.

Main points at a glance:

• RCEP is a free trade agreement in the Asia-Pacific region.
• Fifteen countries signed the agreement including Australia, Brunei, Cambodia, China,  Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam.
• With the participation of the 15 countries, they have formed the world's largest free trade zone, covering about 30% of the world's population and nearly 30% of global GDP.
• China’s presence notably increases the impact of the agreement and boosts the total GDP of the RCEP member countries.
• India did not join the partnership over concerns that cheap import products might pose a harm to local producers.
• The new free trade zone is bigger than the US-Mexico-Canada Agreement (USMCA) and the European Union.
• The RCEP will reduce taxes on most goods over a 20-year period, streamline customs procedures, regulates the field of intellectual property and digital trade and replace a number of bilateral trade agreements in the region with one set of rules.
• Some benefits are expected to be seen in 2021 once participate nations complete their domestic ratification procedures.

What does it mean to the global supply chain?

• The RCEP is expected to eliminate a range of tariffs and quotas on most of the goods traded within the region over a 20-year period.
• The "rules of origin” may have the biggest impact. Under RCEP, parts from any member nation would be treated equally, this gives companies in RCEP member countries an incentive to look for supplier within the region.
• Many of the RCEP member countries already have bilateral free trade agreements between each other, RCEP would streamline the various overlapping preferential terms. This reduces complexity and reduce costs for businesses.
• China, Japan and South Korea are the traditional key players for electronics, automotive, textiles and garments industries, having them in the RCEP would ensure supply chain stability to ASEAN countries.
• It gives an incentive for companies to look for supplier within the RCEP member countries, thereby laying the foundation for enabling an accelerated GDP growth within the region.

As RCEP will further fuel the ongoing manufacturing shifts within Asia, it not only affects companies within the member countries but is also relevant to any companies worldwide who have business in the region.

Feel free to reach out to us at dachser.apac-asl@dachser.com to know more about the new free trade agreement. Together we can review your current supply chain locations and identify steps to grasp the greatest benefits under the impact of RCEP.

Latest update on DACHSER Air & Sea Logistics operations

With this update DACHSER would like to inform about the current DACHSER Air & Sea Logistics operations across the regions APAC, EMEA and Americas. In the attached document (see download below) it is listed whether a country organization of DACHSER is operational or, if only limited or not at all, why this is the case. Since the situation in the countries may change rapidly, the attached document will be updated on a regular basis and published on our website.

We sincerely regret any inconveniences caused to our customers due to the pandemic. At DACHSER, we have contingency measures in place and will offer our customers the best alternative solutions to keep the supply chain running. Anyhow, the situation at ports, airports or customs authorities might cause delays. Furthermore, the capacity situation on the global airfreight market is very tense as there are basically no passenger flights operating at the moment.

At the same time, DACHSER has installed strict hygiene measures (e.g. home office) to ensure a safe working environment and to do our part in stopping the spread of the virus. DACHSER is trying to keep the impact of these measures as low as possible, however, together with the official measures by the governments, the precautions may lead to some delays in the operations.

In case of any questions and/or queries, please feel free to contact your local DACHSER representative.

Route to 2030: Strategies for challenging times

In the previous issue of the DACHSER magazine, we analyzed how global supply chains are changing as a new geopolitical and economic era dawns. So how must companies position themselves to ensure sustainable success—and what path has DACHSER chosen? We present a compass for the journey toward new horizons.

The new DACHSER magazine is here!

Nobody can predict the future—not politicians, not scientists, and not economists. However, that doesn’t mean we can give up the constant task of classifying current developments, tracking trends, and drawing the appropriate conclusions for tomorrow. This requires us to look closely, ask questions—and, most importantly, listen. That might sound obvious, but it can be a real challenge in day-to-day business.