Upgraded Asean, Australia and New Zealand FTA enters into force
Business Times - 21 April 2025
Upgraded Asean, Australia and New Zealand FTA enters into force
The upgraded free trade agreement between Asean, Australia and New Zealand entered into force on Monday (Apr 21), said Singapore’s Ministry of Trade and Industry (MTI) in a press statement.
The move effectively establishes a free trade area of more than 703 million people with a combined gross domestic product of more than US$5.6 trillion.
This upgrade reflects the parties’ commitment “to uphold an open, inclusive and rules-based multilateral trading system”, noted MTI.
It also ensures that the Asean-Australia-New Zealand Free Trade Area (AANZFTA), as it is called, “remains relevant and responsive to evolving global challenges”.
MTI added that the upgraded deal will create a conducive environment to enable businesses, in particular small and medium-sized enterprises (SMEs), to “better seize opportunities” in South-east Asia, Australia and New Zealand.
The ministry said that businesses will, among other things, benefit from more sourcing options and production efficiencies in meeting the agreement’s rules of origin, and time and cost efficiencies arising from streamlined processes for transit arrangements for consolidated shipments.
Businesses will also have greater certainty on the flow of essential goods in times of crisis through expediting the movement, release and clearance of such goods, as well as more transparent and business-friendly regulations in professional, education, financial and telecommunication services.
They will also enjoy improved digital connectivity through the alignment of digital trade standards and interoperability in e-invoicing.
The original AANZFTA entered into force 15 years ago on Jan 1, 2010. According to a write-up on Enterprise Singapore’s website, the agreement eliminates tariffs for 90 per cent of the goods traded between the three parties, and covers 100 per cent of Singapore’s trade volume with Australia and New Zealand.
Deputy Prime Minister and Trade and Industry Minister Gan Kim Yong said the entry into force of the upgraded AANZFTA “marks a significant milestone” in strengthening the parties’ economic resilience and fostering deeper regional cooperation.
“Amid the uncertainties in the global trade environment, this agreement is a bright spot demonstrating Asean’s, Australia’s and New Zealand’s commitment to an open, inclusive and rules-based multilateral trading system,” he noted.
“It underscores the enduring importance that we place on cooperation among Asean, Australia and New Zealand in navigating an increasingly complex global landscape. We will continue to help our businesses manage disruptions and find new opportunities for growth, particularly our SMEs.”
MTI said in its statement that Asean, Australia and New Zealand share “strong economic ties”.
According to the latest available figures, Asean’s total trade in goods with Australia and New Zealand amounted to US$138.4 billion in 2023.
