Apart from that, China signed a bilateral free trade agreement with ASEAN member Singapore in October 2008. Beijing has also developed many separate, smaller and more specific bilateral agreements with ASEAN neighbours, such as the famous investment agreements between the Philippines and China (the theme of major corruption scandals in the Philippines in 2007), harmonized food security standards with Thailand (to facilitate agricultural trade) and numerous agreements with the Mekong Delta countries. The AGREEMENT establishing the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) came into force in January 2010. The Free Trade Agreement is the most comprehensive agreement covering a wide range of issues, including trade in goods and services, investment, intellectual property, competition and economic cooperation. Since its inception, AANZFTA has encouraged trade in goods and services by removing barriers and reducing transaction costs for companies wishing to operate in Member States. Under the agreement, 99% of Australia-New Zealand merchandise trade with Indonesia, Malaysia, the Philippines and Vietnam will be tariff-free by 2020. After full implementation in 2025, almost all trade between Member States will be tariff-free, which will help businesses save millions of tariffs each year. The framework agreement was signed by eleven heads of government on 4 November 2002 in Phnom Penh, Cambodia. [4]: Hassanal Bolkiah (Sultan of Brunei Darussalam), Hun Sen (Prime Minister of Cambodia), Megawati Soekarnoputri (President of Indonesia), Bounnhang Vorachith (Prime Minister of Laos), Mahathir bin Mohamad (Prime Minister Minister of Malaysia), Than Sh (Prime Minister of Burma), Gloria Macapagal-Arroyo (President of the Philippines), Goh Chok Tong (Prime Minister of Singapore), Thaksin Shinawatra (Prime Minister of Thailand), Phan Ven Khi (Prime Minister of Vietnam) , Zhu Rongji (Prime Minister of the State Council of the People`s Republic of China). [4] [5] ASEAN has concluded a number of free trade agreements with other Asian nations that are radically changing the global landscape of public procurement and production. It has, for example, a contract with China that has effectively reduced tariff reduction to nearly 8,000 product categories, or 90% of imported goods, to zero. These favourable conditions came into force in China and in ASEAN members, including Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand. The manufacturing trend is therefore to continue to develop products for this huge consumer market, but to place the production capacity needed for this purpose on a cheaper site.
The ASEAN Free Trade Agreement with China allows regional companies and MNN in Asia to do so. This is a trend that is already underway – as we are seeing with Foxconn, the manufacturer of many components that end up in Apple products, who want to relocate their 1.3 million workers from China and Indonesia, where wages are lower and where there is a large and available workforce. This is a solid strategy that is increasingly being adopted by many manufacturers. ASEAN members together have a population of more than 650 million. Indonesia accounts for more than 40% of the region`s population and its population has been the most opposed to the agreement. [17] [13] The free trade agreement reduced tariffs to zero to 7,881 categories of goods, or 90% of imported goods. [15] This reduction came into effect in China and in the original six ASEAN members: Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. The other four countries are expected to follow in 2015. [16] A year later, a framework agreement was signed for the draft free trade agreement.