Mongolia on Tuesday became the 7th member of the Asia-Pacific Trade Agreement (APTA). Originally known as the Bangkok Agreement, the pact is a preferential regional trade agreement which was founded in 1975 under the United Nations (UN) Economic and Social Commission for Asia and the Pacific (ESCAP), and is open to accession by any member states of the commission.
According to the UN, APTA “aims to promote the economic development of its members through the adoption of mutually beneficial trade liberalization measures that contribute to regional trade expansion and economic cooperation”. The current members of the agreement include India, Bangladesh, Laos, South Korea, Sri Lanka, and China.
The deal is Mongolia’s first regional trade agreement with developing countries. As a member of the APTA, Mongolia will be able to enjoy reduced tariff barriers and get an opportunity to obtain greater market access to South, Southwest, and Southeast Asia, as well as China, the country’s biggest trading partner. Mongolia’s ambassador to Thailand, Tumur Amarsanaa, said that accession to the agreement would also allow the country to “further expand its trade and economic cooperation with the member nations, contribute to the diversification of its economy as well as more active involvement in regional integration processes”.
“This is the first expansion of APTA after the accession of China back in 2001,” said Armida Salsiah Alisjahbana, the Executive Secretary of ESCAP, at the ceremony for Mongolia’s joining. “It is an important milestone in the progress of APTA towards becoming a contemporary regional agreement. The accession of Mongolia to APTA will benefit the business sector of APTA Participating States through facilitating trade and access to the Mongolian market, and certainly vice versa,” she added.
I welcome #Mongolia's accession as the 7th member of the #AsiaPacific Trade Agreement today.
— Armida Alisjahbana (@UN_Armida) September 29, 2020
This is the first expansion of APTA after the accession of China back in 2001. It is an important milestone in the progress of APTA towards becoming a contemporary regional agreement. pic.twitter.com/Im61CfvDl2
Despite its significance, Mongolia’s entry into APTA does not, unfortunately, guarantee it access to other major trade deals, like the Regional Comprehensive Economic Partnership (RCEP), which is supposed to be signed by the end of this year. However, experts have argued that if Ulaanbataar continues to strengthen its relations with member nations of both the agreements, it could pave the way for Mongolia to be a part of the RCEP as well.