ASEAN KEY DESTINATIONS
ASEAN to upgrade free trade deals
ASEAN will upgrade its free trade deals with China, Japan and South Korea as the region looks to its East Asian partners for a boost amid current external economic uncertainties.
International Trade and Industry Minister Mustapa Mohamed said ASEAN had existing free trade agreements (FTAs) with each of the three countries but would like to upgrade them to spur trade growth.
“The FTA upgrades will be comprehensive and cover many areas, including goods, services and investments,” Mustapa said after chairing the ASEAN Economic Ministers Consultation sessions with Japan, South Korea and China, which were held separately.
Last year, total trade between ASEAN and China stood at US$366.5 billion, while with Japan and South Korea, the figure recorded was US$229 billion and US$79.8 billion.
Mustapa said this year would be challenging for ASEAN economies due to the current market and currency worries which have slowed the region’s trade growth with a number of countries, including China.
“However, we feel that prospects of increasing trade between ASEAN and the three countries remain positive.”
Mustapa said the FTA upgrades would help ASEAN reach its 2020 trade targets of US$1 trillion with China and US$200 billion with South Korea.
“The upgrade is important as it will support the achievement of our targets.
“To achieve US$1 trillion in trade with China by 2020, for example, we will require more trade facilitation measures and need to look more closely into tariffs,” he added.
Mustapa said that during their meeting, the ASEAN ministers discussed with their counterparts from the three East Asian countries on ways to upgrade the FTAs.
“We are all committed, though we still have some way to go, and we hope to achieve some progress between now and November, when our country leaders meet for the ASEAN Summit,” he said.
Asked whether ASEAN would consider denominating its trade with China using the yuan, Mustapa welcomed member countries to do so.
He said Malaysia had already decided to denominate its trade with China, its biggest partner, in yuan.
“The yuan has become a more acceptable currency and since it makes a lot of sense to diversify the use of currencies, we hope more ASEAN countries will join us,” he added.
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