ASEAN, China Update Free Trade Deal to Mitigate Impact of U.S. Tariffs

In the wake of hefty U.S. tariffs that have disrupted global supply chains, China and the Association of Southeast Asian Nations (ASEAN) have strengthened their free trade pact to deepen cooperation and reduce reliance on the American export market, Kate Nishimura reported for Sourcing Journal.

China and ASEAN have been each other’s largest trading partners for five consecutive years. (Photo: ASEAN Facebook) 

Signed on the sidelines of the 47th ASEAN Summit in Kuala Lumpur by China’s Commerce Minister Wang Wentao and Malaysia’s Investment, Trade, and Industry Minister Tengku Zafrul Aziz, in a ceremony attended by Chinese Premier Li Qiang and Malaysian Prime Minister Anwar Ibrahim, the plan upgrades an existing framework in an effort dubbed the China–ASEAN Free Trade Area 3.0 Upgrade Protocol.

With U.S.-bound exports from China declining due to tariffs and uncertainty over future trade negotiations, regional commerce among Asian nations has flourished.

China and ASEAN—the trade bloc comprising Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Brunei, Timor-Leste, and Vietnam—have been each other’s largest trading partners for five consecutive years.

The bilateral exchange of goods continues to grow: during the first three quarters of 2025, China’s trade with ASEAN reached about $785 billion, up 9% from the same period last year, according to China’s State Council.

Bilateral trade totaled $771 billion in 2024, according to ASEAN government statistics.