Asean, China seal free trade agreement upgrade

Kuala Lumpur

AFTER a last-minute hitch which stopped Asean and China from signing an agreement on Saturday to upgrade their existing free trade, officials from both sides worked overnight to resolve the issue. The agreement was finally inked on Sunday before the 27th Asean Summit was wrapped up.

A statement issued by Malaysia, the summit's host, said the Protocol To Amend The Framework Agreement On Comprehensive Economic Co-Operation Between Asean and China was signed by the economic ministers of both sides, witnessed by their leaders.

Prime Minister Lee Hsien Loong told Singapore reporters at the end of the summit: "Because we were all here and we were close to agreement, overnight, they worked away and the form of words was settled and we were able to sign the agreement."

The Asean-China FTA upgrade will improve some of the rules and the requirements of the original FTA so it will be easier for business people to take advantage of it - and it's less onerous, he said. "The delay from yesterday to today was not really due to the substance, (it) was to do with some drafting which doesn't affect the economic substance of the deal."

Mr Lee said "it's not a good thing" to have these 11th-hour hitches but in this case, "all's well that ends well and we hope we will be able to avoid such difficulties in future".

The upgraded FTA is expected to boost Asean-China trade from US$500 billion in 2015 to US$1 trillion in 2020. It will also raise two-way investment flow to US$150 billion by that year.

The Malaysian statement said the upgraded FTA will improve services trade and economic and technical cooperation as well.

Sunday also saw the 10 Asean leaders declare the formal rollout of the Asean Community on Dec 31 this year and officially launch the blueprint for the regional grouping to forge ahead in the next 10 years.

Mr Lee said: "The (2025) vision is not the completion of the Asean story. First of all, there are things we'd like to do beyond the goals we set for 2020. Secondly, even for 2015, this Asean Community, not all the goals we set have been achieved. So this is work agenda for the next 10 years for Asean."

On the Asean Economic Community, he said most of the targets have been progressively met. "It's not that there will be a sudden transition on the 31st of December, because most of the pieces are already done. What they (Singapore businessmen) need to do is to understand better what is being offered and how they can take advantage of the rules and fit within the rules in order to gain access to other markets."