Apr. 3 – The European Union (EU) has been a key trade partner for many Asian countries over the last decade. This trend is likely to continue as over 90 percent of world demand is generated outside the EU, causing the organization to reach out and negotiate free trade agreements (FTAs) with key Asian countries.
In this article we’ll take a look at some of the central FTAs (and their current status) between the EU and key Asian nations.
Current negotiations
Japan
The EU and Japan commenced negotiations for a FTA on March 25, 2013, with the first round of talks scheduled to take place in Brussels this April. Japan is the EU’s second largest trading partner in Asia (behind China); a bilateral FTA between the two countries would boost EU exports to Japan by 30 percent.
ASEAN Nations
The EU launched negotiations for a FTA with Thailand on March 6, 2013. Thailand is the EU’s third largest trading partner within the Association of Southeast Asian Nations (ASEAN) and the fourth separate ASEAN country to begin negotiations for a bilateral FTA with the EU. The EU is also currently negotiating a FTA with Malaysia (initially began in May 2010) and Vietnam (initially began in June 2012).
In addition, Indonesia seeks to bolster its Comprehensive Economic Partnership Agreement (CEPA) with the EU by way of an ambitious FTA that will cover 95 percent of all tariff lines and 95 percent of trade values between the two regions. Indonesia and Germany are also set to commence FTA negotiations, after the successful visit of the Indonesian President to Germany earlier this year.
ASEAN is the EU’s third largest trading partner outside of Europe (after the United States and China), with the EU being the largest contributor of foreign direct investment into ASEAN, investing US$246.3 billion in 2012.
India
FTA talks between the EU and India began in 2007 and are currently scheduled to be concluded by the end of April. India houses a sizable and growing market of more than 1 billion people, and is one of the EU’s most important trade partners.
Finished but not yet enforced
Singapore
FTA negotiations between the EU and Singapore concluded on December 16, 2012. It is the EU’s second FTA with a major Asian trading partner (the first one was with South Korea). It is also the first FTA with an individual member of ASEAN. Once fully implemented, the FTA will open up markets on both sides throughout various sectors, including the banking, insurance and other financial services industries.
The FTA has yet to be implemented, as the EU and Singapore are now waiting for their respective governments to sign and install the draft agreement (tentatively scheduled for the Spring of 2013). Singapore is the EU’s largest trading partner in Southeast Asia, and EU-Singapore trade in goods and services grew by about 40 percent between 2009-2011.
