ASEAN Steps Up Regional Engagement To Safeguard Growth Amid Protectionist Headwinds

By Siti Radziah Hamzah

KUALA LUMPUR, Sept 24 (Bernama) -- Confronted with rising protectionism, non-tariff barriers and fragile supply chains, ASEAN Economic Ministers (AEM) have committed to stepping up cooperation to consolidate regional resilience.

This includes intensifying engagement with dialogue partners towards free trade and facilitating investment flows to enhance the grouping’s standing as a key trade and investment destination.

After three days of discussions and consultations with various partners, ASEAN reached a consensus on advancing economic integration. They committed to achieving nine Priority Economic Deliverables (PEDs) that fall under the responsibility of the AEM.

This was evident in a 50-point joint statement issued after the 57th AEM, chaired by Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz, where member states underscored the critical and urgent need to strengthen the multilateral trading system.

In a press communique later in the day, Tengku Zafrul said that through deeper integration and strategic partnerships, ASEAN was shaping a trade and investment ecosystem that is open, resilient and future-ready.

To achieve this, the grouping’s economies agreed to undertake pragmatic, forward-looking and inclusive reforms, particularly in the face of increasing global trade governance complexities and uncertainties, as evidenced by rising protectionism brought on by sweeping United States tariffs on all members.

“In our year as ASEAN chair, Malaysia is proud to lead efforts that turn dialogue into delivery,” the minister said.

An important pre-requisite towards enhancing its economic prowess in the global arena was for ASEAN to leverage its centrality in the Regional Comprehensive Economic Partnership (RCEP) agreement to shape the emerging economic order and upgrade free trade pacts with members.

China, Japan, South Korea, Australia, and New Zealand, which, combined with the 10 ASEAN economies, make RCEP the world’s largest free trade area.

Prime Minister Datuk Seri Anwar Ibrahim had said that “the RCEP must be renewed with political energy and that it must not remain a legal text on paper”.

To this end, he announced that Malaysia, as chair of ASEAN, would convene a RCEP leaders summit to be held alongside the 47th ASEAN Summit in October.

To finalise the agenda for the summit, an RCEP Ministerial Meeting will be held tomorrow. The programme also includes consultations with the ASEAN Plus Three (ASEAN+3) countries comprising China, Japan and South Korea, as well as the United Kingdom and the European Union (EU).

A highlight after three days of AEM meetings and consultations with dialogue partners was a commitment given by United States Trade Representative Jamieson Greer, signalling Washington’s stronger engagement with Southeast Asian economies.

He also commended the grouping’s ongoing efforts to expand market access, remove non-tariff barriers and strengthen security cooperation as deliverables which would strengthen ASEAN-US trade and investment linkages.

This comes just a month after the US imposed sweeping tariffs on all 10 regional economies.

At the 22nd ASEAN-ROK Consultation, South Korea’s Trade Minister Yeo Han-Koo confirmed that Seoul is finalising the upgrade of the ASEAN-Korea Free Trade Agreement (AKFTA), to be announced at next month’s leaders’ summit.

The ASEAN+3 Consultation, involving China, Japan and South Korea, highlighted cooperation in semiconductor supply chains, digital trade and the green economy, while reaffirming regional financial backstops through the Chiang Mai Initiative Multilateralisation (CMIM). 

Trade between ASEAN and its Plus Three partners reached US$1.2 trillion in 2024, accounting for 31.7 per cent of ASEAN’s total trade, while foreign direct investment (FDI) inflows from the three countries stood at US$44.4 billion, or close to 20 per cent of total FDI into the region.

 Alongside the consultations, regional business leaders stressed the need for ASEAN to accelerate structural reforms to boost private capital markets and enforce rules against non-tariff barriers. 

They noted that existing mechanisms, such as the ASEAN Assist portal, have been ineffective, as businesses remain reluctant to raise complaints, underscoring the need for stronger enforcement capacity within the bloc.

ASEAN also underscored progress in upgrading the ASEAN Trade in Goods Agreement (ATIGA), advancing the ASEAN-China FTA 3.0 Upgrade Protocol, and introducing sustainable investment guidelines, all aimed at fortifying the bloc against external shocks. 

 Upon the conclusion of the 57th AEM, it is clear that ASEAN is signalling its ambition to reinforce resilience while pivoting toward knowledge-driven and value-added growth in an increasingly uncertain global economy.

-- BERNAMA