ASEAN and China have upgraded their free trade agreement to expand cooperation in digital and green industries. The signing took place during a summit in Malaysia, marking a significant step in the economic relations between the two sides. The revised deal, known as the FTA 3.0 version, covers new sectors such as the digital economy, green technology, and advanced manufacturing. China aims to expand trade opportunities as global competition intensifies.
Trade Remains a Top Priority
ASEAN remains China’s largest trading partner. According to ASEAN data, their bilateral trade reached $771 billion last year. The regional bloc, which includes 11 nations, has a combined GDP of $3.8 trillion. China wants deeper integration with Southeast Asia to counter tough US tariffs pushed by President Donald Trump’s administration. These tariffs have targeted several countries and increased pressure on global supply chains.
China Seeks Openness Despite Criticism
Beijing continues to present itself as an open and trade-friendly economy. However, other major powers criticize China for expanding export controls on rare earths and minerals. Chinese officials argue that the upgraded agreement will boost market access and competitiveness, especially in agriculture, pharmaceuticals, and digital services.
Part of a Larger Regional Trade Strategy
Both sides are already members of the Regional Comprehensive Economic Partnership. RCEP covers one-third of the world’s population and 30 percent of global GDP. Malaysia hosted an RCEP summit in Kuala Lumpur on Monday, the first in five years. Analysts say the pact could help cushion Asian economies from US tariff actions. Yet, they also believe the agreement’s rules remain less ambitious than some other regional trade deals due to varying national interests.
