ASEAN-China Trade Deal Upgrade To Boost Investment, Trade — ASEAN Sec-Gen

By Nurul Hanis Izmir

KUALA LUMPUR, May 25 (Bernama) -- The upgraded ASEAN-China Free Trade Area (CAFTA) 3.0 agreement, set to be signed later this year, marks a key milestone in strengthening trade, investment and connectivity between the two economic powers, ASEAN Secretary-General Dr Kao Kim Hourn said.

He said the finalisation of CAFTA 3.0 was both timely and critical amid global economic uncertainty.

“Both ASEAN and China have been working on the upgrade for some time. Last year, both sides reached substantial outcomes, but only this year have we been able to finalise the full upgrade to version 3.0,”  he told a pool media interview here today.

Kao is leading the ASEAN Secretariat delegation to the 46th ASEAN Summit, the 2nd ASEAN-Gulf Cooperation Council (GCC) Summit, and the inaugural ASEAN-GCC-China Summit.

He said the update was essential to ensure the FTA remains relevant and responsive to today’s trade realities, particularly given the scale of ASEAN-China trade.

“China has been ASEAN’s number one trading partner for 16 consecutive years, and likewise, ASEAN has become China’s top trading partner over the past five to six years.

“That reflects the strength of our economic ties,” he said, adding that the upgraded agreement is expected to open up greater opportunities for businesses on both sides by enhancing trade facilitation, investment flows and tourism connectivity.

Kao noted that together, ASEAN and China represent a market of two billion people.

“So this upgrade is highly significant, particularly during this period of global economic dynamics and uncertainty,” he said.

Bilateral trade, driven by CAFTA since its launch in 2010, has recorded strong growth. China has remained ASEAN’s top trading partner for 16 straight years, while ASEAN has led as China’s largest trading partner for the past five years.

Last year, bilateral trade rose to nearly US$1 trillion (US$1=RM4.23).

Looking ahead to the meetings in the coming days, Kao expressed hope that ASEAN leaders and partners would reaffirm their commitment to open trade and a rules-based international trading system.

“ASEAN remains open, transparent and fully committed to a multilateral system, with the World Trade Organisation (WTO) at its core. We have never retreated from this position,” he stressed.

He said ASEAN’s position had been consistent, as reflected in joint statements by ASEAN economic ministers and leaders reaffirming their support for multilateralism.

“ASEAN works closely with our seven bilateral FTA partners—China, Japan, Korea, Australia, New Zealand, India and Hong Kong—alongside the 15-nation Regional Comprehensive Economic Partnership (RCEP). We must continue to uphold what we believe in: open, rules-based trade,” he added.

The ASEAN-China FTA, signed in 2004 and implemented in 2010, is among ASEAN’s most comprehensive trade frameworks. The upcoming 3.0 upgrade aims to deepen liberalisation and align the agreement more closely with current business trends and the digital economy.

-- BERNAMA