ASEAN trade with China is increasing, leading member states to balance protectionism with liberalization in the global market.
In 2023, ASEAN trade showed three main trends: reduced intra-regional transactions, increased reliance on external partners like China, and continued complexity of trade agreements. There are also emerging patterns of protectionism and resource nationalism. As ASEAN countries adjust to the fast-paced global market, they will continue to balance protectionist measures with further liberalization in 2024 and beyond.
ASEAN Economic Growth in 2023
ASEAN is the world’s economic dark horse, poised to become a global centre of growth. As member states heavily rely on trade, it is essential to analyze the development of ASEAN trade in 2023.
Intra-ASEAN Trade Trends
In 2023, despite efforts to promote intra-regional trade, most of ASEAN’s trade remained with extra-regional countries. The percentage of intra-ASEAN trade in relation to member states’ total trade experienced a decline from 22.5 per cent in the first three quarters of 2022 to 21.8 per cent in the corresponding period in 2023.
Increasing Trade with China
Trade between China and ASEAN is set to grow significantly, with China emerging as a crucial trading partner for many ASEAN member states. This trend is driven by geopolitical tensions and Southeast Asia’s role as a trade transit corridor.
ASEAN is the third-largest economy in Asia and the fifth-largest in the world. It is a significant emerging market with high consumption potential, making it crucial for China to address issues related to weak domestic demand and overcapacity in production.
Future of ASEAN Trade
As ASEAN continues to navigate global trade dynamics, the region’s increasing reliance on China, proliferation of FTAs, and concerns over economic nationalism are expected to shape trade trends in 2024 and beyond.
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