Thanks to the China-ASEAN Free Trade Agreement (CAFTA), more commodities from ASEAN countries, ranging from agricultural products such as mango, durian and coffee to primary and intermediate products like rubber and paper, entered the Chinese market. In 2020, China and ASEAN became their main trading partners for the first time.
by Xinhua Writers Wang Yaguang and Mao Pengfei
BANGKOK, July 19 (Xinhua) – The 10-member Association of Southeast Asian Nations (ASEAN) and China celebrate the 30th anniversary of the establishment of their dialogue relationship on Monday.
Since relations began in July 1991, the volume of bilateral trade has grown from less than US $ 8 billion to over US $ 680 billion last year. With such a solid foundation, the two sides pledged to strengthen cooperation in all sectors to open a new chapter of ASEAN-China joint development and prosperity.
The Thai-Chinese Rayong Industrial Zone in Thailand’s Rayong Province has been a miniature and the result of such win-win cooperation. Founded in 2006 and now home to 160 foreign companies, the factory employs 40,000 local workers, mainly in the automotive, electronics and machinery sectors.
Himile Group, a leading China-based tire mold supplier, chose to set up a factory in the area in 2014.
âMost of our customers, the world’s largest tire producers, have built their production bases in ASEAN countries. We want to get closer to them (…) to serve the Southeast Asian market, âsaid Qiu Jinliang, general manager of the Thai branch of Himile.
Over the past seven years, the factory’s production and sales capacity has grown by 60% per year, Qiu said, noting that “the biggest challenge now is that our production capacity is falling short of demand from clients”.
In the past year and a half, despite the COVID-19 outbreak and associated travel restrictions, the industrial zone has managed to attract 27 Chinese companies to invest there, said Zhao Bin, chairman of Thai-Chinese Rayong Industrial. Realty Development.
With more than 650 million consumers and a supply chain hub for major industries, ASEAN is becoming an important strategic market for Chinese companies, Siam Commercial Bank of Thailand said in a research report.
In 2020, China’s foreign direct investment (FDI) in ASEAN countries jumped 52.1% year-on-year, reversing a global downward trend. Meanwhile, ASEAN investors continue to see a rosy prospect in China for its strong post-pandemic recovery and the new development paradigm of “dual circulation”, with the bloc’s investment in the mainland of China. China jumping 50.7% in the first half of 2021, according to China’s Ministry of Commerce.
Bilateral trade has also flourished over the years, supported by a friendly relationship between the two parties and the China-ASEAN Free Trade Agreement (CAFTA).
Thanks to CAFTA, more products from ASEAN countries, ranging from agricultural products such as mango, durian and coffee to primary and intermediate products such as rubber and paper, have entered the Chinese market. In 2020, China and ASEAN became each other’s biggest trading partner for the first time.
In May, Cambodia exported its first batch of fresh mangoes directly to China as part of increased agricultural cooperation between the two countries.
Cambodian Agriculture Minister Veng Sakhon expects the country’s fresh mango exports to China to total 100,000 tonnes this year.
“We will continue to strengthen cooperation with China, increasing the exports of our products to the Chinese market,” he said.
The volume of trade between China and ASEAN maintained robust growth in 2021, increasing 27.8% year-on-year in the first six months, according to Chinese customs statistics.
In November last year, the Comprehensive Regional Economic Partnership Agreement (RCEP) was signed by its 15 participating countries, including China and the 10 ASEAN members, creating a massive free trade area covering approximately 30% of the gross domestic product, trade and population of the world.
RCEP marks “the beginning of a new era for China-ASEAN relations” and is a boon for trade and investment not only in Southeast Asia, but also around the world, said Panitan Wattanayagorn, Chairman of the Thai Prime Minister’s Security Advisory Committee.
Chheang Vannarith, president of the Asian Vision Institute, based in Phnom Penh, said RCEP would promote regional trade and investment, as it would further reduce trade barriers, expand the integrated regional market and strengthen regional supply chains. .
“The tailwind of RCEP will give us a boost,” said Zhao Feng, vice president of SAIC Motor-CP Co., Ltd., a joint venture between Shanghai-based SAIC Motor Corporation and Thai conglomerate CP Group. Once in force, the agreement will facilitate the company’s imports and exports, lower operating costs and minimize risks.
With a planned investment of over 30 billion baht (about US $ 1 billion), SAIC Motor-CP’s plant in Thailand’s Chonburi province was one of Thailand’s largest FDI projects. âWe aim to make it the manufacturing base of MG brand right-hand drive vehicles in ASEAN,â Zhao said.
After working 25 years in the automotive industry and eight years in SAIC Motor-CP, Jakkit Chuwitsakunlert is now a senior manager in the company’s quality assurance department. He said what impressed him the most was the efficiency of the company, or “Chinese speed” as he called it.
âEverything has to be done very quickly. Itâs very difficult, but think in a positive way, itâs a good thing,â said Jakkit. âBoosted by Chinese speed, I have no doubt that our business will grow faster and faster.
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