EU Aims for Trade Deals with Malaysia, Other ASEAN Nations by 2027
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The European Union is actively pursuing free trade agreements with Malaysia, the Philippines, and Thailand, aiming to finalize these deals before the 50th anniversary of EU-ASEAN relations in 2027. This push for new trade partnerships comes as the EU seeks to diversify its trade relationships, especially considering recent trade tensions with the United states.
EU Trade Strategy in Southeast Asia
European Union Trade Chief Maros Sefcovic discussed the timeline for a potential trade agreement with Malaysian prime Minister Anwar Ibrahim during recent ASEAN meetings in Kuala Lumpur. Sefcovic expressed confidence in concluding the agreement with Malaysia next year,acknowledging the Prime Minister’s inquiry about the timeframe given the 2027 deadline.
The EU’s increased focus on trade deals with Southeast Asian nations and other regions like south America (with the Mercosur agreement) reflects a broader strategy to reduce reliance on the US market, especially following the imposition of tariffs during the Trump administration.
Recent Trade agreement with Indonesia
This renewed push builds on the recent success of a trade agreement signed with Indonesia in Bali on August 23, 2023. This deal will eliminate tariffs on most goods traded between the EU and Indonesia, with full implementation expected by January 2027. https://www.reuters.com/markets/europe/eu-indonesia-seal-zero-tariff-trade-deal-most-goods-2023-08-23/
Addressing Past Obstacles with Malaysia
Negotiations with Malaysia were paused in 2012 due to concerns over the perceived unfair treatment of Malaysian products,particularly palm oil,within the proposed agreement. The resumption of talks this year signals a willingness from both sides to address these historical issues and forge a mutually beneficial trade relationship. Palm oil remains a key export for Malaysia, and securing favorable terms for this commodity is likely a priority in the ongoing negotiations. https://www.thestar.com.my/aseanplus/aseanplus-news/2023/08/24/eu-malaysia-resume-fta-talks-after-11-year-hiatus
Other Trade Discussions
Beyond ASEAN, Sefcovic is also scheduled to meet with US Trade Representative Jamieson Greer in Kuala Lumpur to attempt to resolve stalled discussions regarding tariffs on steel and aluminum exports. This indicates the EU’s continued efforts to address trade barriers with key partners globally.
Key Takeaways:
* the EU is prioritizing trade agreements with Malaysia, the Philippines, and Thailand, aiming for completion by 2027.
* A recent trade deal with Indonesia, eliminating tariffs on most goods, sets a positive precedent.
* Resumed negotiations with Malaysia address past concerns regarding palm oil and other products.
* The EU is actively diversifying its trade partnerships in response to global trade dynamics.