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Tariffs

Asean and China Sign Upgraded Free Trade Deal Amid Steep US Tariffs

Strategic Insights

— 1 min read

Amid increasing trade friction between Beijing and Washington, the Association of Southeast Asian Nations (Asean) and China have signed a comprehensive free trade agreement, covering the digital and green economy sectors, and supply chain connectivity. The deal aims to strengthen economic cooperation between the two regional partners, which are each other's largest trading partners. The upgraded agreement was signed by Malaysian Trade Minister Zafrul Abdul Aziz, representing Asean, and Chinese Commerce Minister Wang Wentao during the Asean-China Summit in Kuala Lumpur.

Key Takeaways:

  • The upgraded free trade deal between Asean and China covers the digital and green economy sectors, and supply chain connectivity, aiming to expand economic and trade cooperation between the two regional partners.
  • The deal was signed by Malaysian Trade Minister Zafrul Abdul Aziz, representing Asean, and Chinese Commerce Minister Wang Wentao during the Asean-China Summit in Kuala Lumpur.
  • Chinese Prime Minister Li Qiang stated that the agreement "ushers in new opportunities for expanding economic and trade cooperation."
  • External forces, specifically the United States, are interfering in the region and have imposed high tariffs on Asean members.
  • Total trade between Asean and China reached US$770.94 billion in 2024, an increase of 10.61% from the previous year.
  • Asean members, including Malaysia, Indonesia, and the Philippines, have been hit with higher tariffs imposed by US President Donald Trump.
  • Trade tensions between China and the United States were rekindled earlier this month after Beijing announced new curbs on exports of rare earth elements essential for high-tech manufacturing.

Statistics:

  • Total trade between Asean and China: US$770.94 billion in 2024 (an increase of 10.61% from the previous year).
  • Asean members that have been hit with higher tariffs imposed by the United States: Malaysia, Indonesia, and the Philippines.

Sources:

  • "Asean, China sign upgraded free trade deal as trade tensions simmer" by Reuters.

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