China-ASEAN economic and trade cooperation continues to deepen

 The 19th China-ASEAN Expo and China-ASEAN Business and Investment Summit recently concluded in Guangxi, China. A total of 267 international and domestic cooperation projects were signed at this year’s CAEXPO, with a total investment of over 400 billion yuan, an increase of 37% over the previous session. This dazzling report card once again witnessed the increasingly close economic and trade exchanges between China and ASEAN.

According to data released by the General Administration of Customs of China, in the first eight months of this year, China’s imports and exports to ASEAN increased by 14% year-on-year, and its imports and exports with other members of the Regional Comprehensive Economic Partnership (RCEP) increased by 7.5% year-on-year. The growth rates of the two figures both exceeded the level in the first half of this year, and ASEAN continued to maintain its status as China’s largest trading partner. ASEAN research scholars believe that as RCEP continues to release policy dividends, China-ASEAN economic and trade cooperation will usher in more opportunities and release more momentum.

The total GDP of RCEP countries accounts for 30.5% of the world’s total, far exceeding NAFTA (28%)

Connectivity inspires new vitality

China and ASEAN are both important manufacturing bases in the world and have huge consumer markets. The two sides have complementary advantages and deep integration of industrial and supply chains, and economic and trade cooperation is showing vigor and vitality.

The Friendship Pass, located in Pingxiang Comprehensive Bonded Zone, Chongzuo City, Guangxi Zhuang Autonomous Region, is the main channel for China to import ASEAN fruits. During the peak fruit season, trucks loaded with fruits such as durian, dragon fruit, jackfruit and mangosteen from ASEAN countries pass through customs here in an endless stream. With the continuous improvement of the level of trade liberalization and facilitation between the two sides, the “fruit basket” between China and ASEAN is getting bigger and bigger.

In 2019 and 2021, Cambodian bananas and mangoes will gradually become the country’s fresh fruits that can be directly exported to China, bringing huge business opportunities to Cambodian fruit farmers. According to the Ministry of Agriculture and Cooperatives of Thailand, in the first half of this year, Thailand exported 1.124 million tons of fresh fruits to China, up 10% year-on-year. Since July this year, the General Administration of Customs of China has approved the import of Vietnamese passion fruit through the normal trade channel in a pilot form.

In addition to the continuous writing of mutually beneficial and win-win stories in fruit trade, this year, as the ASEAN economy gradually recovers from the impact of the new crown pneumonia epidemic, the region’s demand for machinery and equipment has also increased. In the first seven months of this year, China’s mechanical and electrical products ranked first among similar imported products from Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam and other ASEAN countries.

Starting from Kunming, China in the north, and Vientiane, Laos in the south, since the China-Laos Railway was put into operation at the end of last year, the “Lancang” train has passed through the mountains and mountains, paving a fast lane for the common prosperity of the regions along the line. As of August 7, the total import and export goods of the China-Laos railway exceeded one million tons, with a value of about 9.14 billion yuan.

In the western region of China, the new western land-sea corridor connects the western part of China and the markets of ASEAN countries and becomes an economic corridor to promote trade between China and ASEAN. In the first half of this year, a total of 2,705 trains of the new western land-sea corridor were operated, and 269,000 TEUs of goods were sent, an increase of 112% and 319% respectively year-on-year.

The prosperity of the China-Laos railway, the new western land-sea corridor and the two major golden logistics corridors has effectively promoted the continuous and in-depth development of China-ASEAN economic and trade cooperation.

Tang Zhimin, director of the China-ASEAN Research Center of the Chia Tai School of Management in Thailand, said that the trade structure between China and ASEAN is being continuously optimized, and the industrial chain and supply chain are more closely linked.

Xu Ningning, executive director of the China-ASEAN Business Council, said that China and ASEAN have political and commercial connections, the two sides have free trade agreements, strong economic and trade complementarity, and have regional advantages for cooperation and support for interconnectivity. The economic and trade cooperation between China and ASEAN continues to deepen.

Cross-border e-commerce becomes a new engine

In March this year, a lively live-streaming event brought goods closer to Chinese and ASEAN consumers. The consul generals of Malaysia, Thailand and Vietnam in Nanning acted as “cargo anchors”, enthusiastically promoting Malaysian Musang King durians, Thai latex pillows, Vietnamese coffee, Guangxi jasmine tea and other high-quality products to Chinese and ASEAN consumers through e-commerce platforms.

“Cross-border e-commerce has become an important factor in maintaining and tightening economic and trade ties between Vietnam and China during the epidemic prevention and control period,” said Do Nam Trung, the Vietnamese consul general in Nanning. In the view of Thai Consul General in Nanning Binjama Tavitaryanon, e-commerce can help people in rural areas of Thailand and China create and increase income, and the two sides should continue to strengthen cooperation in this field.

In recent years, cross-border e-commerce has become a fast-growing new business format and new model in the cooperation between China and ASEAN, which has effectively hedged the impact of the epidemic on trade.

As an important hub for China to carry out cross-border e-commerce import and export business transactions with ASEAN, Guangxi has attracted more than 100 cross-border e-commerce enterprises to settle in. At the same time, Chinese e-commerce platforms have accelerated the pace of building overseas warehouses in Southeast Asian countries. In Indonesia, JD.com has established a stable and efficient supply chain infrastructure, with a distribution network covering most of the country’s provinces.

According to a report released by the Boao Forum for Asia Research Institute in July, the Asia-Pacific region is the region with the best performance in cross-border e-commerce in the world, accounting for 53.6% of the global market size. China and ASEAN have contributed greatly. In the first half of this year, China’s cross-border e-commerce exports to ASEAN increased by 98.5%.

Wang Xi, vice-chairman of the Commercial Industry Committee of the China Council for the Promotion of International Trade, said that the scale of cross-border e-commerce imports and exports has continued to expand, becoming a new engine driving the development of trade between China and ASEAN. The report of the Boao Forum for Asia Research Institute believes that under the combined effect of the RCEP taking effect, the normalization of the online economy, government support and market forces, China-ASEAN cross-border e-commerce cooperation has broad prospects.

RCEP injects new impetus

In January this year, RCEP came into effect, injecting new impetus into China-ASEAN economic and trade cooperation.

One of the beneficiaries of RCEP is United Steel (Malaysia) Group, located in Kuantan, the capital of the Malaysian state of Pahang. As the first batch of enterprises to settle in the Malaysia-China Kuantan Industrial Park, the steel products produced by this Chinese-funded enterprise are exported to Singapore, the Philippines, Indonesia, Thailand and other countries. “The entry into force of RCEP has realized the coordination of economic and trade rules in the region, and the import and export of steel products has become more convenient.” Hu Jiulin, deputy general manager of the company, said frankly.

Brunei businessman Zheng Zuoliang runs a trading company that sells Brunei’s shrimp chips, coffee and other products to the Chinese market, and introduces Chinese citrus and other products to the ASEAN market. He was deeply impressed by the facilitation of customs clearance after RCEP came into effect: “Customs procedures have been simplified. For goods that meet the requirements, Guangxi Customs implements a facilitation measure to release within 6 hours.”

Statistics from the Vietnam Aquatic Products Processing and Export Association show that in the first seven months of this year, Vietnam’s aquatic product exports to China amounted to about US$1 billion, a year-on-year increase of 71%. The Trade Promotion Agency of the Ministry of Industry and Trade of Vietnam stated that RCEP has created convenience for Vietnam’s major export industries, especially aquatic products to be exported to important trading partners in the region.

Hu Yishan, a senior researcher at the Singapore Institute of International Affairs, believes that the entry into force of RCEP has deepened the integrated development of regional industrial chains and supply chains, has become a “catalyst” for regional economic recovery, and enhanced people’s confidence in ASEAN’s economic development prospects.

Tang Zhimin said that under the RCEP framework, both China and ASEAN countries have adopted the negative list method, and have made a high-level commitment to opening up investment in non-service sectors such as manufacturing, agriculture, forestry, fishery, and mining. The cumulative rules of origin adopted by RCEP are convenient for enterprises to choose the best layout of the industrial chain and supply chain between China and ASEAN countries. “These institutional dividends have effectively promoted trade cooperation between China and ASEAN. The implementation of free trade agreement frameworks such as RCEP has shown broad prospects for trade between China and ASEAN, with unlimited potential.”

China-ASEAN economic and trade cooperation continues to deepen