Latest news with #CAFTA
Borneo Post
28-05-2025
- Business
- Borneo Post
Upgraded China-Asean trade pact doubles down on inclusive, sustainable growth
Workers cast off the ropes for a ship bound for Asean countries at a container dock of Qingdao Port in Qingdao, east China's Shandong Province on April 30, 2025. – Xinhua photo KUALA LUMPUR (May 29): In a significant stride toward regional economic integration, China and the Association of Southeast Asian Nations (Asean) countries have completed negotiations on an upgraded free trade agreement, doubling down on their efforts to promote inclusive and sustainable growth. The Version 3.0 China-Asean Free Trade Area (CAFTA) came at a critical moment, sending a clear and strong signal in support of free trade and open cooperation amid growing protectionism and trade fragmentation, analysts told Xinhua on the sidelines of the ongoing 2025 Asean Summit and related summits. The deal, a pivotal enabler for Asean and China's sustained growth and competitiveness, marks a shift 'from traditional goods to the future economy', said Tan Kar Hing, deputy chairman of Malaysia's Center of Regional Strategic Studies. Beyond tariff cuts and smoother trade, the upgraded agreement incorporates nine new chapters covering such strategic areas as digital economy, green economy, supply chain resilience, small and medium-sized enterprise (SME) support and customs cooperation, reflecting 'broader coverage and greater specificity', the Malaysian expert said. As major developing economies, China and Asean have been each other's largest trading partners for years. Data from China's General Administration of Customs showed that in the first four months, two-way trade reached 2.38 trillion yuan (US$330 billion), up 9.2 per cent from a year earlier. Their highly complementary economies form a cornerstone of regional cooperation. Visitors select Malaysian products at the 5th China International Consumer Products Expo (CICPE) in Haikou, south China's Hainan Province on April 15, 2025. – Xinhua photo For export-driven economies like Malaysia, the upgrade eases access to Asean and Chinese markets, particularly for small businesses. 'Local SMEs can now connect directly with regional markets through digital platforms – true 'local creation, regional expansion',' Tan said. The pact also streamlines agricultural exports and builds traceable supply chains, key for Malaysia's food and commodity sectors. The evolution from Version 1.0's basic tariff reductions to Version 3.0's rule alignment signals a 'deepening commitment to a high-level free trade agreement that is inclusive, modern, comprehensive and mutually beneficial', said Tang Zhimin, director of China Asean Studies at the Bangkok-based Panyapiwat Institute of Management. 'By aligning rules, recognising standards and enhancing mechanisms, the upgraded deal strengthens the foundation for collaboration in supply and industrial chains,' Tang said. The inclusion of new priority areas in CAFTA 3.0 demonstrates the agreement's responsiveness to pressing regional concerns, reflecting that 'the China-Asean Free Trade Area is not static, but continues to evolve to address current and future challenges', said Wijayanto Samirin, an economist at Indonesia's Paramadina University. More importantly, the upgraded free trade agreement signifies the resilience and growing strength of multilateralism against protectionism, the Indonesian analyst said. 'It particularly underscores Asean and China's support for multilateralism, injecting certainty into global trade. 'The pact highlights both sides as 'steadfast supporters of economic globalization,' Tang said. Thong Mengdavid, a lecturer at the Institute for International Studies and Public Policy of the Royal University of Phnom Penh in Cambodia said: 'Asean and China are opting for openness over fragmentation.' Participants pose for group photos during a roadshow for the 3rd China International Supply Chain Expo held in Kuala Lumpur on May 26, 2025. – Xinhua photo The deal also reduces reliance on Western markets. 'It diversifies supply chains and reduces excessive dependence on specific export markets, thus enhancing autonomy and resilience for medium-sized economies like Malaysia,' said Tan in Malaysia. Cambodia's Thong added that it boosts the bloc's 'collective negotiating power on the global market,' calling Asean-China ties 'a stabilising force' amid global volatility. This is particularly significant given that China and Asean, as the world's second and fifth-largest economies respectively, account for a quarter of the global population. Unlike rigid Western trade pacts, CAFTA 3.0 emphasises 'inclusivity, flexibility and phased advancement', Tan said, noting that its framework lets members tailor cooperation to domestic priorities. Malaysia, for instance, can fast-track projects in agriculture or green technology. 'This isn't a one-size-fits-all model but a ladder for developing economies to climb at their own pace,' he said. The pact's completion reflects 'unprecedented consensus' between China and Asean on institutional design, agenda setting and cooperation roadmaps, 'evolving from basic tariff cuts to systemic rules', Tan said, adding that it highlights 'a renewed leap in political mutual trust and economic integration between the parties'. Since its inception in 2010, the China-Asean Free Trade Area has become a template for South-South cooperation. 'Its institutional innovations based on shared consultation and development continue to inspire and revitalize global governance,' said Tang. – Xinhua asean CAFTA China China-Asean Free Trade Area Xinhua
Malaysia Sun
27-05-2025
- Business
- Malaysia Sun
Economic Watch: Upgraded China-ASEAN trade pact doubles down on inclusive, sustainable growth
The Version 3.0 China-ASEAN Free Trade Area (CAFTA) came at a critical moment, sending a clear and strong signal in support of free trade and open cooperation amid growing protectionism and trade fragmentation, analysts told Xinhua. KUALA LUMPUR, May 27 (Xinhua) -- In a significant stride toward regional economic integration, China and the Association of Southeast Asian Nations (ASEAN) countries have completed negotiations on an upgraded free trade agreement, doubling down on their efforts to promote inclusive and sustainable growth. The Version 3.0 China-ASEAN Free Trade Area (CAFTA) came at a critical moment, sending a clear and strong signal in support of free trade and open cooperation amid growing protectionism and trade fragmentation, analysts told Xinhua on the sidelines of the ongoing 2025 ASEAN Summit and related summits. The deal, a pivotal enabler for ASEAN and China's sustained growth and competitiveness, marks a shift "from traditional goods to the future economy," said Tan Kar Hing, deputy chairman of Malaysia's Center of Regional Strategic Studies. Beyond tariff cuts and smoother trade, the upgraded agreement incorporates nine new chapters covering such strategic areas as digital economy, green economy, supply chain resilience, small and medium-sized enterprise (SME) support and customs cooperation, reflecting "broader coverage and greater specificity," the Malaysian expert said. As major developing economies, China and ASEAN have been each other's largest trading partners for years. Data from China's General Administration of Customs showed that in the first four months, two-way trade reached 2.38 trillion yuan (330 billion U.S. dollars), up 9.2 percent from a year earlier. Their highly complementary economies form a cornerstone of regional cooperation. For export-driven economies like Malaysia, the upgrade eases access to ASEAN and Chinese markets, particularly for small businesses. "Local SMEs can now connect directly with regional markets through digital platforms -- true 'local creation, regional expansion,'" Tan said. The pact also streamlines agricultural exports and builds traceable supply chains, key for Malaysia's food and commodity sectors. The evolution from Version 1.0's basic tariff reductions to Version 3.0's rule alignment signals a "deepening commitment to a high-level free trade agreement that is inclusive, modern, comprehensive and mutually beneficial," said Tang Zhimin, director of China ASEAN Studies at the Bangkok-based Panyapiwat Institute of Management. "By aligning rules, recognizing standards and enhancing mechanisms, the upgraded deal strengthens the foundation for collaboration in supply and industrial chains," Tang said. The inclusion of new priority areas in CAFTA 3.0 demonstrates the agreement's responsiveness to pressing regional concerns, reflecting that "the China-ASEAN Free Trade Area is not static, but continues to evolve to address current and future challenges," said Wijayanto Samirin, an economist at Indonesia's Paramadina University. More importantly, the upgraded free trade agreement signifies the resilience and growing strength of multilateralism against protectionism, the Indonesian analyst said. "It particularly underscores ASEAN and China's support for multilateralism, injecting certainty into global trade." The pact highlights both sides as "steadfast supporters of economic globalization," Tang said. Thong Mengdavid, a lecturer at the Institute for International Studies and Public Policy of the Royal University of Phnom Penh in Cambodia said, "ASEAN and China are opting for openness over fragmentation." The deal also reduces reliance on Western markets. "It diversifies supply chains and reduces excessive dependence on specific export markets, thus enhancing autonomy and resilience for medium-sized economies like Malaysia," said Tan in Malaysia. Cambodia's Thong added that it boosts the bloc's "collective negotiating power on the global market," calling ASEAN-China ties "a stabilizing force" amid global volatility. This is particularly significant given that China and ASEAN, as the world's second and fifth-largest economies respectively, account for a quarter of the global population. Unlike rigid Western trade pacts, CAFTA 3.0 emphasizes "inclusivity, flexibility and phased advancement," Tan said, noting that its framework lets members tailor cooperation to domestic priorities. Malaysia, for instance, can fast-track projects in agriculture or green technology. "This isn't a one-size-fits-all model but a ladder for developing economies to climb at their own pace," he said. The pact's completion reflects "unprecedented consensus" between China and ASEAN on institutional design, agenda setting and cooperation roadmaps, "evolving from basic tariff cuts to systemic rules," Tan said, adding that it highlights "a renewed leap in political mutual trust and economic integration between the parties." Since its inception in 2010, the China-ASEAN Free Trade Area has become a template for South-South cooperation. "Its institutional innovations based on shared consultation and development continue to inspire and revitalize global governance," said Tang.
Barnama
25-05-2025
- Business
- Barnama
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.
CNA
25-05-2025
- Business
- CNA
ASEAN to sign improved China, internal trade deals as bloc weighs ‘bolder' moves to tackle US tariffs
KUALA LUMPUR: Easier trade among members of the Association of Southeast Asian Nations (ASEAN) as well as with the regional bloc's top economic partner, China, is on the horizon as the grouping pushes ahead with 'bolder' moves to stave off the threat of steep US tariffs. ASEAN has concluded negotiations on upgrading the ASEAN Trade In Goods Agreement (ATIGA) and the China-ASEAN Free Trade Area (CAFTA), with the enhanced deals set to be signed in October, Malaysia's Investment, Trade and Industry Minister Tengku Zafrul Abdul Aziz told reporters on Sunday (May 25) ahead of the 46th ASEAN summit. 'We remain confident that these milestones will serve as a pivotal enabler for ASEAN's sustained growth and competitiveness,' Tengku Zafrul said after chairing an ASEAN Economic Community Council Meeting. 'The successful conclusion of these negotiations is expected to enhance the region's economic integration and generate significant economic benefits for ASEAN as we continue to navigate an increasingly volatile global economic landscape.' As the rotating chair for ASEAN this year, Malaysia has urged the bloc to diversify its trading partners in the face of sweeping tariffs imposed by US President Donald Trump. Speaking on Sunday, Tengku Zafrul warned the bloc against staying still at a time of economic uncertainty. 'ASEAN would need to break away from a business-as-usual approach,' he said. 'We need to adopt bolder, more agile and more forward-looking strategies. We need to safeguard and advance ASEAN socioeconomic interests.' ASEAN has reaffirmed its commitment to stand by the principles of multilateralism and a rules-based global trading order, even as it continues to maintain a policy of non-retaliation against the US tariffs, Tengku Zafrul said. 'We don't plan to have any measures that will represent a retaliation to what has been introduced,' he said. Tengku Zafrul said every ASEAN member is a 'sovereign nation' and should be supported in pursuing bilateral tariff negotiations with the US. 'But it's important that in all these meetings, we also reiterate the ASEAN position,' he added. At the summit on Monday and Tuesday, ASEAN is expected to explore the expansion of regional free trade agreements alongside engaging other economic blocs and dialogue partners, measures which Tengku Zafrul said were discussed at the economic council meeting. FACILITATING TRADE WITHIN ASEAN 'We also discussed how ASEAN can improve trade within,' the minister added, noting that intra-ASEAN trade accounts for approximately 23 per cent of the bloc's total trade. 'There's a lot of room for improvement. When we look at other economic blocs, they trade with each other internally more than what ASEAN is doing today.' ATIGA is aimed at achieving a free flow of goods between ASEAN member states, resulting in lower business costs, increased trade, and a larger market and economies of scale for businesses. The upgraded agreement targets the further lowering of tariffs and the removal of non-tariff barriers among member countries. It will feature 'forward-looking and commercially meaningful provisions aimed at further boosting regional trade, enhancing supply chain resilience, and also boosting deeper economic integration within ASEAN', Tengku Zafrul said. Singapore, which chaired the upgrade negotiations, said it will continue to work with ASEAN and global partners to secure the bloc's long-term growth, competitiveness, and shared prosperity. The successful conclusion of the upgrade negotiations "demonstrates ASEAN's commitment to building a more seamless and resilient economic region, as well as to preserve a rules-based trading environment to better support businesses' operations in the ASEAN region amidst an uncertain global economic climate", Singapore Trade and Industry Minister Gan Kim Yong said in a statement on Sunday. Earlier on Sunday, Malaysia's Foreign Minister Mohamad Hasan highlighted that ASEAN nations are among those most heavily hit by US tariffs. 'We must seize this moment to deepen regional economic integration, so that we can better shield our region from external shocks,' he said in opening remarks at a meeting of ASEAN foreign ministers. The US-China trade war is 'dramatically disrupting' production and trade patterns worldwide, Mohamad said, cautioning that a global economic slowdown was likely to happen. TAKING ASEAN-CHINA TRADE FORWARD ASEAN is China's largest trading partner, with the value of total trade reaching US$234 billion in the first quarter of 2025, according to Chinese customs data. The so-called 3.0 version of CAFTA will "promote the deep integration of the production and supply chains of both sides", China's commerce ministry said in a statement on Wednesday, when it announced the completion of negotiations. The upgraded pact will also 'inject greater certainty into regional and global trade and play a leading and exemplary role for countries to adhere to openness, inclusiveness and win-win cooperation', the ministry said. China has intensified engagement with ASEAN since Trump announced hefty import tariffs on countries around the world and targeted China with even heavier levies. Some of the levies have since been delayed while China and the US agreed this month to pause some of their tariffs. In his Sunday remarks, Mohamad described ASEAN as a region where geopolitical ambitions, as well as economic and security interests, intersect. 'External pressures are rising, and the scope of challenges has never had higher stakes,' he said, stressing that ASEAN unity is now 'more important than ever'. 'It is therefore crucial that we reinforce the ties that bind us, so as to not unravel under external pressures.'
Malaysia Sun
25-05-2025
- Business
- Malaysia Sun
Stronger China-ASEAN partnership amid U.S. trade war
The ASEAN logo in front of the Petronas Twin Towers in Kuala Lumpur, Malaysia, May 15, 2025. /CFP Editor's note: Yu Hong, a special commentator on current affairs for CGTN, is a senior research fellow of the East Asian Institute, National University of Singapore. The article reflects the author's opinions and not necessarily the views of CGTN. As Malaysia hosts the 46th ASEAN Summit and related meetings in Kuala Lumpur, it has to be borne in mind that Southeast Asia is among the regions hit hardest by U.S. tariffs. On April 2, the U.S. government announced so-called "reciprocal tariffs" on the ground that it was trying to reduce the United States' huge trade deficit and counteract the alleged unfair trade practices of its trading partners. As export-oriented economies, Southeast Asian countries are facing daunting challenges since they are highly dependent on the U.S. market for their merchandise exports. While the U.S. has agreed to a 90-day moratorium on "reciprocal tariffs" on most countries, there is mounting uncertainty about the future. Southeast Asian countries urgently need to strengthen their economic integration and explore new foreign trade strategies, building new partnerships and consolidating the existing ones to diversify trade. This will enable them to hedge the potential impact of uncertainty and trade shock. In the face of the escalating trade war between China and the United States, ASEAN countries have been taking prudent measures to balance their economic and trade relations with both powers. China is their largest trading partner, whilst the United States is a key export market. They have sent officials to the U.S. for trade negotiation while seeking to deepen their economic ties with China. The U.S. seems to be interested in promoting "de-sinicization" of the supply chain of Southeast Asia, while China is strengthening the interconnection of its industrial and supply chains with the region through mechanisms such as the China-ASEAN Free Trade Area (CAFTA) and the Regional Comprehensive Economic Partnership. In response to the impact of the "reciprocal tariffs," ASEAN and China have a strong will to strengthen bilateral economic and trade ties, and deepen cooperation to promote stability and economic growth in the Asia-Pacific region. ASEAN Secretary-General Kao Kim Hourn gives an interview to Xinhua in Jakarta, Indonesia, March 25, 2025. /Xinhua During an interview this year, ASEAN Secretary-General Kao Kim Hourn, while advocating multilateralism to address common challenges, said the bloc is committed to deepening its comprehensive strategic partnership with China. In the face of the rise of global protectionism, he expressed ASEAN's resolve to uphold free trade and "to keep the global economic trading system open, free and rule-based." The proportion of China-ASEAN trade in goods in ASEAN's total foreign trade rose from 11.6 percent in 2009 to nearly 20 percent in 2023, exceeding ASEAN's trade with other major trading partners. Since the China-ASEAN relationship was upgraded to a comprehensive strategic partnership in 2021, their bilateral trade has continued to increase. By 2024, they were each other's largest trading partners for five consecutive years. In the first quarter of 2025, ASEAN continued to be China's largest trading partner, with total trade of 1.71 trillion yuan ($234.17 billion), a year-on-year increase of 7.1 percent. Its proportion of China's overall foreign trade increased to 16.6 percent. Bilateral investment cooperation is also deepening. In 2023, China was the second largest source of foreign investment in ASEAN, with its direct investment reaching $25.12 billion, a 34.7 surge year on year. ASEAN is becoming the priority region for many Chinese enterprises going overseas. In addition, ASEAN is also an important source of foreign investment for China. The combined population of China and the ASEAN countries is more than two billion, with a very sizable middle-income group. This will provide a huge market demand and strong impetus for regional economic growth. Version 3.0 of CAFTA is expected to open up new space for industrial and supply chain cooperation between the two. Negotiations for that have been concluded, with the two sides agreeing to expand cooperation in emerging areas such as the digital economy, green economy, and supply chains. They have also agreed to strengthen mutual integration and connectivity in areas such as standards and rules, and jointly promote trade facilitation and inclusive development. The conclusion of the CAFTA 3.0 negotiations demonstrates the political determination of both to uphold the rule-based multilateral trading system. The implementation of CAFTA 3.0 will give new impetus to regional integration and promote open and inclusive economic globalization. Chinese President Xi Jinping visited three ASEAN countries, Vietnam, Malaysia and Cambodia, in April. China issued a joint statement with each country, confirming the need to strengthen economic and trade cooperation, and jointly build a stable industrial and supply chain. Looking ahead, ASEAN and China can explore strengthening mutually beneficial cooperation in emerging areas such as the digital economy, artificial intelligence, electric vehicles and clean energy. China's growing economic influence in the region can provide market space for ASEAN countries in the face of global trade challenges. However, ASEAN countries are also concerned about the potential risk of Chinese goods pouring into the ASEAN market, which could have a negative impact on local industry and employment. To forge closer China-ASEAN integration, China should continue to further open up the domestic market, and reduce trade and non-trade barriers. (If you want to contribute and have specific expertise, please contact us at opinions@ Follow @thouse_opinions on Twitter to discover the latest commentaries in the CGTN Opinion Section.) Source: CGTN
