China and ASEAN Finalize Talks on Enhanced Free Trade Agreement
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Container trucks cross the Tianbao port, a border crossing between China and Vietnam, in Malipo county, Wenshan prefecture, Yunnan province, China May 8, 2025. REUTERS/Kevin Krolicki/File Photo Purchase Licensing Rights, opens new tab
HONG KONG, May 21 — China and the Association of Southeast Asian Nations (ASEAN) have officially concluded negotiations on an upgraded version of their free trade agreement, expanding the scope to include the digital economy, green development, and emerging industries, according to China’s Ministry of Commerce.
ASEAN, a 10-member regional bloc, remains China's largest trading partner, with bilateral trade reaching $234 billion in the first quarter of 2025, Chinese customs data shows.
Dubbed the “3.0 version” of the ASEAN-China Free Trade Area, the new agreement aims to strengthen regional cooperation, foster inclusive and sustainable growth, and serve as a model for global trade openness. It is designed to boost connectivity across supply chains and deepen integration between ASEAN and Chinese industries.
Talks on the upgraded deal began in November 2022. The agreement is expected to improve collaboration in key sectors, including digital innovation, environmental sustainability, and supply chain resilience.
China has stepped up its engagement with ASEAN in recent years, particularly after the U.S. imposed wide-ranging tariffs during the Trump administration. While some tariffs have been delayed or rolled back, trade tensions continue to shape global economic dynamics.
In April, Chinese President Xi Jinping toured Southeast Asia to strengthen ties with neighboring countries, urging the region to resist unilateralism and protectionism.
The formal signing of the upgraded trade agreement is anticipated before the end of 2025. The original ASEAN-China Free Trade Area was established in 2002 and took effect in 2010.
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