Widen opening-up for ASEAN members
China, Japan and the Republic of Korea should also take measures to further open up their economies to the members of the Association of Southeast Asian Nations. For example, the three countries should expand the coverage of "zero-tariff" goods, shorten the transition period for tariff reductions, help their enterprises import more high-quality goods and services from ASEAN, encourage businesses to strengthen the industry and supply chains within the RCEP region, fully implement the RCEP's rules of origin, and lower the threshold for ASEAN enterprises exporting products to China, Japan and the ROK.There is huge potential for the development of China-Japan-ROK trade in services. China is the largest service trade market for Japan and the ROK, and given the complementarity of the three economies, Japan and the ROK can benefit from increased trade with China. In the next five to 10 years, China's industrial, consumption and urban-rural structural transformations will not only generate substantial demand for services from Japan and the ROK but also make service trade a new driver for growth in the region.
From 2013 to 2023, the value of service trade among China, Japan and the ROK grew at an average rate of 4.5 percent a year, 2 percent higher than the growth rate of goods trade. In 2021, the share of trade in services was 7.8 percent in China-Japan trade, 8.22 percent in China-ROK trade and 11.06 percent in Japan-ROK trade, all below the global average of 21.4 percent, highlighting the huge room for further growth. If the share of services trade between the three countries reaches the global average, it is estimated to create an additional market worth $1.4 trillion.
Given their rapidly rising aging populations, China, Japan and the ROK should consider creating a common healthcare market for mutual benefit, because China's market for healthcare in 2030 is expected to be worth 16 trillion yuan ($2.20 trillion). With the lifting of restrictions on wholly foreign-owned hospitals in seven provinces and cities in the first half of this year, China is expected to introduce more supportive policies, creating new opportunities for Japanese and ROK enterprises in the healthcare sector.
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