China and the Association of Southeast Asian Nations have signed an upgraded free trade agreement at the 47th ASEAN Summit in Kuala Lumpur, formalizing a new version of a pact that has shaped regional trade for more than two decades.
According to CNA, the ASEAN-China Free Trade Area 3.0 Upgrade Protocol was signed on the final day of the summit by China’s commerce minister, Wang Wentao, and Malaysia’s investment, trade and industry minister, Tengku Zafrul Abdul Aziz. Chinese Premier Li Qiang and Malaysian Prime Minister Anwar Ibrahim were present for the signing.
The upgraded pact builds on the original ASEAN-China Free Trade Area, which was first signed in 2002 and took effect in 2010. CNA reported that the first upgrade was negotiated from 2014 and came into force in 2019, making the latest deal the second major revision.
The new version covers the digital economy, the green economy, supply-chain connectivity and related areas. Beijing had previously described the agreement as a way to improve market access in sectors including agriculture, digital services and pharmaceuticals. CNA said the modernization is intended to strengthen regional supply chains and support micro, small and medium-sized enterprises.
The timing of the deal gives it additional weight. It was signed as governments in the region were watching tensions between the United States and China, including tariff threats and trade-policy uncertainty. Li used the summit to warn against unilateralism and protectionism, while Anwar emphasized ASEAN’s centrality and its willingness to engage major partners on all sides.
The numbers underline why the pact matters. CNA reported that China has been ASEAN’s largest trading partner for 16 consecutive years. In the first three quarters of 2025, trade between China and ASEAN reached 5.57 trillion yuan, or about US$783.3 billion, up 9.6 per cent from a year earlier.
For ASEAN, the deal is also a reminder of the bloc’s balancing act. It is a major economic grouping in its own right, and the upgraded agreement with China reflects both commercial interdependence and the political need to keep trade channels open as global tariff disputes escalate.
The signing does not end the economic rivalry between Beijing and Washington, but it does show that China and Southeast Asia continue to deepen their institutional ties even as wider trade conditions remain unsettled. For businesses that depend on regional supply chains, the new protocol is meant to bring more predictability to cross-border trade.
Event date: 2025-10-28.
