During the 27th ASEAN-China Summit in Vientiane, ASEAN and China announced the near completion of negotiations to upgrade the ASEAN-China Free Trade Area (ACFTA), with finalization expected next year. The upgrade, critical amidst rising global protectionism, will focus on new areas such as the digital and green economies, supply chain connectivity, and consumer protection.
Singapore’s Prime Minister Lawrence Wong emphasized the importance of free trade during these uncertain times, stating that the upgraded FTA will not only reaffirm commitments to open markets but also unlock future growth areas. The FTA, since its inception in 2010, has led to significant trade increases, with ASEAN and China becoming each other’s top trading partners by 2020. Trade between the two sides tripled from US$235.5 billion in 2010 to US$696.7 billion in 2023. China remains ASEAN’s largest trading partner and the third-largest source of foreign direct investment.
The upgrade is set to include provisions that will enhance cooperation in clean energy, climate change, and digital economy initiatives, making it future-ready for both ASEAN and China. Wong highlighted China’s expertise in renewable energy and its potential role in ASEAN’s transition to cleaner fuels and the creation of a regional power grid.
Additionally, Wong called for the continued pursuit of peaceful resolutions to disputes in the South China Sea and urged for the swift conclusion of a Code of Conduct that aligns with international law, including the United Nations Convention on the Law of the Sea (UNCLOS).
On the same day, ASEAN commemorated 35 years of dialogue relations with South Korea and held summits with Japan, India, Australia, and Canada, further deepening regional ties.
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