ASEAN to Ink Upgraded Trade Deal with China in 2025
Jakarta. ASEAN intends to sign its upgraded trade pact with China in 2025, according to the Southeast Asian bloc’s secretary-general Kao Kim Hourn.
The 2024 ASEAN chair Laos hosted the group’s annual gathering with its top trading partner China just last week. China and ASEAN have been trying to upgrade their bilateral trade deal over the years, and this marked the third time that both sides refreshed their agreement by incorporating more areas. The 10-member grouping recently announced the “substantial conclusion” of the ASEAN-China Free Trade Area (ACFTA) 3.0 which includes new areas of cooperation, including green and digital economy.
“The leaders look forward to the substantial conclusion of the ACFTA 3.0 upgrade negotiations. … This ACFTA upgrade will be ready by next year,” Kao told a briefing in Jakarta on Tuesday, while saying that the pact could “further enhance regional economic integration”.
According to a joint leaders’ statement issued after the ASEAN-China Summit, the countries all agreed that the members would only be able to enjoy the benefits with an early signing and timely implementation of the upgraded trade pact. It also called for the upgrade protocols to be signed in 2025 during which Malaysia would be holding ASEAN’s rotating chairmanship.
Chinese Premier Li Qiang told the ASEAN-China Summit at the time that the enhanced trade deal would provide “institutional safeguards to build super-sized markets together”.
“It also demonstrates our unequivocal support for multilateralism and free trade,” Li said.
The ACFTA -- which sought to grant members drastic import tariff cuts -- first got signed in 2002, and has gone through three upgrades since then. ASEAN and China first began negotiating the third upgrade in 2022. The Chinese government reported that ASEAN-China trade amounted to $911.7 billion in 2023, making both sides as each other’s largest trading partners for four consecutive years.
China is also a key trading partner for Indonesia. Data showed bilateral trade hit $127.8 billion throughout last year, and had already reached $84.8 billion in January-August 2024. However, Indonesia suffered a $7.6 billion deficit when trading with China over the said eight-month period.
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