ASEAN aims to bring upgraded goods trade pact into force by end-2026, ahead of schedule: Gan Kim Yong

SINGAPORE: The upgraded ASEAN Trade in Goods Agreement (ATIGA) is set to come into force by the end of this year instead of mid-2027, said the Ministry of Trade and Industry (MTI) on Tuesday (Sep 22).

Deputy Prime Minister Gan Kim Yong, who is also Minister for Trade and Industry (Trade), said that the Association of Southeast Asian Nations (ASEAN) had already signed the upgraded agreement, with member countries to ratify it earlier.

Mr Gan represented Singapore at the 58th ASEAN economic ministers’ meeting and related meetings held from Saturday to Tuesday in Manila.

"We are now planning to bring it forward to this year, and we are working very hard with our fellow ASEAN members to race to the end and to cross the line before the end of the year," Mr Gan told reporters.

"This will bring forward many of the benefits for our businesses and for our people," he said, adding that it will facilitate trade in "a significant way".

Mr Gan said that ATIGA will simplify and clarify trade rules, making it easier for businesses to operate across ASEAN and facilitating greater intra-regional trade.

MTI said its earlier implementation would also mean businesses can benefit sooner from smoother trade flows, improved customs procedures and reduced friction when trading across the region.

ASEAN is also looking beyond traditional trade to new areas of economic integration, including the green economy.

It is studying the feasibility of an ASEAN Green Economy Framework Agreement (GEFA). Once the study is completed, ASEAN plans to move to a scoping exercise before beginning negotiations, which Mr Gan said could start sometime next year.

According to MTI, the proposed framework will support the development of an interoperable ASEAN carbon market.

EXPANDING RCEP

ASEAN is also seeking to strengthen its economic links beyond the grouping, including through the Regional Comprehensive Economic Partnership (RCEP). RCEP comprises the 10 ASEAN members, as well as China, Japan, Australia, New Zealand and South Korea.

An ad hoc accession working group will be established to consider Bangladesh, Chile, Sri Lanka and Hong Kong. MTI said expanding the pact could create new market access and trade opportunities for businesses, while reinforcing RCEP's key role in regional economic integration.

RCEP currently accounts for about 30 per cent of global gross domestic product and 30 per cent of the world's population.

"So, with additional members, this will also signify that RCEP is a growing region and will continue to grow," Mr Gan said.

Members are also reviewing the agreement to see how its provisions and rules can be strengthened to further facilitate trade.

ASEAN is also exploring closer economic integration with the European Union.

Mr Gan said discussions on digital trade principles between ASEAN and the EU are ongoing, with the grouping hoping to complete negotiations next year.

A free trade agreement (FTA) could be a longer-term objective, he said.

"I had suggested during the meeting that perhaps we can take a step-by-step approach, look at what we can do together, and over time, then we can have a longer-term vision of having an FTA between EU and ASEAN," Mr Gan said.

The developments come ahead of Singapore taking over the ASEAN chairmanship, as well as the chairmanship of the ASEAN economic ministers’ meetings, in 2027.

"I hope that we can build on the achievements that the Philippines have done this year, and continue to build on the momentum, and to see whether we can make further progress in the ASEAN integration, both internally within ASEAN, as well as connections with our key partners beyond ASEAN," said Mr Gan.