Jakarta. ASEAN's upgraded trade pact with Australia and New Zealand are set to enter into force next month, potentially easing barriers to exports.

In 2023, a document regarding the second upgrade to the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) was signed by the member economies. The signing means all members agree to make another amendment to the existing trade pact in order to include chapters on micro, small, and medium enterprises (MSMEs) as well as government procurement, among others. The enhanced trade pact is set to unlock e-commerce opportunities, thus possibly giving a boost to ASEAN's already thriving internet economy. The first update, which took place in 2015, aimed to streamline the certification processes for the movement of goods.

Australian Ambassador to ASEAN Tiffany McDonald handed over Canberra's ratified document on the upgraded AANZFTA to the Southeast Asian bloc's secretary-general Kao Kim Hourn in Jakarta on Thursday. The diplomats revealed that the upgraded AANZFTA would come into effect on April 21.

"Australia is committed to increasing two-way trade and investment with ASEAN, in turn, further enhancing economic connectivity and resilience in our shared region. The AANZFTA upgrade is central to these efforts," McDonald was quoted as saying in a recent press statement.

McDonald said that ASEAN was Australia's second-largest two-way trading partner. Australia reported that its trade with Southeast Asia had totaled 178 billion Australian dollars (around $111.9 billion) in 2022. Kao told McDonald that Australia's ratification could make the region's economy more resilient, while also making sure that the agreement remains relevant.

"[This] facilitates regional economic recovery and delivers concrete benefits to businesses ...," Kao said.

All 10 ASEAN member states, including Indonesia, are part of the AANZFTA.

Government data shows that Indonesia's trade with Australia had soared last year, although the import-export activities had weakened in early 2025. Indonesia-Australia trade soared from around $12.5 billion in 2023 to nearly $15.4 billion the following year. However, trade only reached $740.9 million in January 2025. The two neighbors managed to trade over $1 billion in the first month of 2024 alone.

Indonesia is seeing a similar trend to New Zealand. In 2024, trade between Indonesia and New Zealand topped $1.9 billion, up from $1.7 billion recorded in the previous year. The monthly trade reached $157.4 million in January 2024 before falling to $134.4 million at the beginning of 2025. New Zealand had already submitted its upgraded AANZFTA ratification document late last year.

The AANZFTA initially came into force for eight signatories, including Australia and Malaysia, in 2010. The trade pact only became effective in Indonesia about two years later.