ASEAN and China conclude upgrade talks on new FTA

Ministers aim to sign the ACFTA 3.0 Upgrade Protocol later this year at the ASEAN-China Summit.

ASEAN member states and their key dialogue partners—China, Japan, Australia, and New Zealand—reaffirmed their commitment to open, rules-based trade and closer economic integration during a series of Special ASEAN Economic Ministers (AEM) Consultations hosted by Malaysia.

According to Singapore’s Ministry of Trade and Industry (MTI), the consultations focused on enhancing regional cooperation in supply chain resilience, green economy initiatives, and digital transformation.

One of the key outcomes was the full conclusion of negotiations to upgrade the ASEAN-China Free Trade Area (ACFTA) to its 3.0 version. The upgraded agreement will incorporate new elements like digital economy provisions, green economy priorities, and enhanced supply chain connectivity.

Ministers aim to sign the ACFTA 3.0 Upgrade Protocol later this year at the ASEAN-China Summit.

ASEAN and China acknowledged their position as each other’s largest trading partners and expressed confidence that ACFTA 3.0 would help future-proof their economic relationship.

The ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) was also in focus, with ministers welcoming the entry into force of its Second Protocol.

The protocol includes updated commitments in areas such as sustainable development, e-commerce, and support for micro, small, and medium enterprises (MSMEs). Singapore is amongst the early implementing countries.

During the AEM-METI (Japan) consultation, ASEAN and Japan discussed deepening collaboration across strategic sectors such as the automotive industry, clean energy, and artificial intelligence.

Both sides committed to fostering a conducive trade and investment environment and to keeping existing frameworks, like the ASEAN-Japan Comprehensive Economic Partnership (AJCEP) and the Regional Comprehensive Economic Partnership (RCEP), updated and business-relevant.

Across all consultations, ministers reaffirmed the central role of the World Trade Organisation (WTO) in global commerce. On the WTO’s 30th anniversary, there was unified support for efforts to reform the organisation and deliver “pragmatic, development-oriented outcomes” at the upcoming Ministerial Conference in 2026.

The ministers also exchanged views on expanding the RCEP, currently the world’s largest free trade agreement. Discussion included enhancing implementation, improving cooperation, and addressing accession processes for aspiring economies.

The Ministry of Trade and Industry said that Singapore “remains steadfast in charting a steady course with ASEAN Member States and our Dialogue Partners through these uncertain times,” adding that the country will continue to advocate for sustainable, inclusive, and forward-looking economic strategies.

The meetings were attended by ministers from ASEAN and their respective partners, including China’s Ministry of Commerce, Japan’s Ministry of Economy, Trade and Industry, and trade representatives from Australia and New Zealand.