The latest step in regional economic integration occurred when China and the Association of Southeast Asian Nations (ASEAN) signed the China–ASEAN Free Trade Area (CAFTA) 3.0 Upgrade Protocol in Kuala Lumpur on October 23, 2023. This protocol was signed by Wang Wentao, China’s Minister of Commerce, along with economic ministers from ASEAN member countries. The updated framework builds upon a previous agreement established in 2010 and aims to enhance cooperation across various critical sectors.
The upgrade focuses on nine key areas, as highlighted by China’s Ministry of Commerce. These areas include the digital economy, green economy, supply chain connectivity, competition policy, and support for micro, small, and medium enterprises. The intention behind these updates is to foster a more integrated economic environment that benefits all parties involved.
During a multilateral meeting held on October 24, Li Qiang, China’s Premier, emphasized the importance of the upgraded agreement, stating it “creates new opportunities for high-quality economic cooperation.” He expressed concerns over the rising tide of unilateralism and protectionism, which he claims have significantly impacted the international economic order.
Li further noted that “external interference in the region is on the rise” due to unreasonable tariffs imposed by some countries. He warned that “power politics and economic bullying” pose threats to development, urging for regional unity. “The more severe the situation, the more firmly we must strengthen solidarity and cooperation,” he stressed, advocating for a coordinated approach to defend legitimate rights and promote stable growth through deeper collaboration.
Commentators view the CAFTA 3.0 Upgrade Protocol as a significant move toward lowering trade barriers, enhancing commerce, and facilitating investment between China and the ten ASEAN member states. An expert commented that the agreement will “enable freer flows of goods and capital and foster an open, fair, and inclusive market benefiting both sides.”
The signing of this protocol marks a pivotal moment in the ongoing efforts of China and ASEAN nations to strengthen their economic ties, positioning themselves to respond effectively to global economic challenges. As regional cooperation deepens, both parties are poised to benefit from the mutual advantages that come with this enhanced trade framework.
