ASEAN is made up of 10 Southeast Asian economies: Indonesia, Thailand, Malaysia, the Philippines, Singapore, Brunei, Vietnam, Laos, Cambodia and Myanmar. In recent years, ASEAN has attracted more and more foreign investment due to its strong economic growth momentum, convenient business environment and considerable development potential. Today, ASEAN is the world's fifth-largest economy and one of the world's most dynamic and fastest-growing regions.
Hong Kong and ASEAN have a long history of economic and trade exchanges, with geographical proximity, people-to-people ties and a solid foundation for co-operation. ASEAN is Hong Kong's second largest trading partner and Hong Kong's third largest export market. The growing demand of the ASEAN market in the fields of finance, telecommunications, tourism, health care and other sectors is highly compatible with Hong Kong's advantageous industries.
ASEAN has become one of the most dynamic and fastest-growing regions in the world. ASEAN is Hong Kong's second largest trading partner and Hong Kong's third largest export market.
Hong Kong signs Free Trade Agreement and Investment Agreement with ASEAN
In November 2017, Hong Kong signed the Free Trade Agreement (FTA) and the Investment Agreement (IPA) with ASEAN. The FTA and the Investment Agreement cover trade in goods, trade in services, investment, economic and technical co-operation, dispute settlement mechanism and other related areas, which will further strengthen trade and investment exchanges between Hong Kong and ASEAN by providing legal protection, better market access conditions and fair and equitable treatment for trade and investment.
Since the signing of the two agreements, Hong Kong's bilateral trade in goods with ASEAN has increased by 38% to a record high of US$165 billion (RMB1,202.1 billion) in 2022. At the same time, Hong Kong's FDI in ASEAN increased by 38% to US$77 billion (RMB561 billion) at the end of 2021.
In August 2023, the Secretary for Commerce and Economic Development of the HKSAR, Mr Alice Yau, attended the 7th Hong Kong, China-Association of Southeast Asian Nations (ASEAN) Economic and Trade Ministers' Meeting. With regard to the Free Trade Agreement (FTA) and Investment Agreement between Hong Kong and ASEAN, Mr Yau and the Ministers of Economy and Trade of ASEAN member states announced the final text of the First Protocol to the Amendment. The Protocol aims to incorporate new product-specific rules of origin into FTAs. The meeting looked forward to the signing of the Protocol as soon as possible and agreed to work towards its early implementation to further facilitate seamless trade between ASEAN and Hong Kong.
Hong Kong signs First Protocol amending the Free Trade Agreement between Hong Kong and the Association of Southeast Asian Nations
On 9 January 2024, the Secretary for Commerce and Economic Development of Hong Kong, Mr Yau Ying-wah, signed the First Protocol to Amend the Free Trade Agreement between Hong Kong and the Association of Southeast Asian Nations (ASEAN), updating the product-specific rules of origin under the Agreement from more than 200 to nearly 600, so that Hong Kong enterprises can obtain Hong Kong-origin qualifications for more specific goods more easily and effectively when expanding into the ASEAN market, thereby obtaining preferential tariff treatment.
Specific products included in the Agreement through the Protocol include different categories of goods of interest to Hong Kong firms and manufacturers, such as jewellery, pharmaceuticals, food and textiles. The signing of the Protocol will help enhance the market competitiveness of the goods concerned and facilitate trade flows, creating more business opportunities for Hong Kong enterprises to develop in the ASEAN market.
"I am confident that the implementation of the Protocol will further promote our economic and trade relations with ASEAN member states. As a staunch supporter of free trade, Hong Kong will continue to work with its trading partners to further liberalisation of trade in the region. ”
Hong Kong has actively explored the ASEAN market and strengthened economic, trade and investment co-operation
In July 2023, a HKSAR delegation organised by the HKTDC and led by Hong Kong Chief Executive John Lee visited Singapore, Indonesia and Malaysia, with a view to further strengthening the economic, trade and investment co-operation between Hong Kong and ASEAN countries, exploring business opportunities for Hong Kong and telling Hong Kong's story.
The delegation visited a number of large enterprises in the three ASEAN countries to learn more about their diversified businesses and introduced the latest policies and measures of the HKSAR Government to attract investment and talents. Mr Lee pointed out that under the "One Country, Two Systems" principle, Hong Kong enjoys the unique advantage of "being backed by the motherland and connected to the world", and hopes that more ASEAN enterprises will explore business opportunities in Hong Kong and use Hong Kong to enter the Guangdong-Hong Kong-Macao Greater Bay Area market.
The visit to ASEAN was fruitful, with a total of 33 memorandums of understanding and agreements (MOUs) and agreements signed between Hong Kong and the three ASEAN countries, the largest number in history, covering a wide range of areas such as commerce and trade, investment, finance, innovation and technology, logistics, academic research and cultural exchanges.
At the same time, the three countries reaffirmed their support for Hong Kong's application to join the RCEP Regional Comprehensive Economic Partnership (RCEP).
China continues to deepen cooperation with ASEAN
January 1, 2024 marks the second anniversary of the entry into force of the Regional Comprehensive Economic Partnership (RCEP). Since the RCEP came into effect, the implementation of policies such as tariff reduction and exemption and accumulation rules of origin has brought significant benefits to the economic and trade exchanges and industrial chain construction between China and ASEAN, and the cooperation between China and ASEAN has been deepened, which continues to contribute to the development of the regional economy.
According to the data, China has maintained the status of ASEAN's largest trading partner for 14 consecutive years, and the two sides have been each other's largest trading partners for three consecutive years. The trade volume of goods between the two sides increased from US$443.6 billion in 2013 to US$975.3 billion in 2022, an increase of 1.2 times. Among the 10 ASEAN countries, China has become the largest trading partner of eight countries: Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
At present, there is a good momentum of mutually beneficial cooperation between China and ASEAN in emerging areas such as the digital economy and the green economy. In the future, with the in-depth implementation of RCEP and the continuous promotion of the Belt and Road Initiative, the regional industrial chains between China and ASEAN are expected to be further integrated, and the exchanges and cooperation between the two sides in various fields will reach a new level.