The signing of the ASEAN-China Free Trade Agreement (ACTFA) 3.0 Upgrade Protocol marks a significant deepening of ASEAN-China economic cooperation. The upgraded agreement incorporates modern chapters on the digital economy, green development, consumer protection, competition policy, and capacity-building for MSMEs. It also strengthens commitments on supply chain connectivity and trade facilitation, introducing measures to streamline customs procedures, harmonize standards, and enhance infrastructure and digital platforms.
For ASEAN, the upgrade enhances predictability and provides a framework for increasing the competitiveness of ASEAN’s exports more deeply into China’s vast market, particularly in emerging sectors tied to digital transformation, green economy, and supply chains resilience. The upgrade also reinforced ASEAN’s trade relationships with other dialogue partners as the region navigates its direction amidst the geoeconomics fluctuations. For China, ACFTA 3.0 reinforces preferential market access for Chinese made goods and serves in Southeast Asia at a time of rising global protectionism. While effective implementation will depend on ratification and consistent application across ASEAN member states, ACFTA 3.0 represents the modernization of the ASEAN-China trade relationship which should help ASEAN and China achieve a $1 trillion per year bilateral two-way trade relationship by 2030.
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