China, ASEAN Finalise Free Trade Upgrade Amid Regional Tensions and Trump Tariff Shock

SHANGHAI – China and ASEAN have agreed to submit their upgraded free trade agreement (FTA) – the “3.0 version” – for leaders’ approval in October, Chinese Foreign Minister Wang Yi said on July 12. Negotiations, launched in November 2022 and completed in May, expand cooperation into digital and green economies and supply chain connectivity. They also adopted a five-year action plan covering over 40 collaboration areas. Wang added both sides aim to finalise a South China Sea code of conduct by 2026.

Free Trade Upgrade

This comes as regional economies reel from US President Donald Trump’s tariff threats against key Asian exporters, spurring them to strengthen intra-Asian trade to cushion against American protectionism and shifting geopolitical risks.

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