Brunei Darussalam views free trade agreements (FTA) as a vital part of its foreign trade policy to maximise free and open trade for its people in an ever-globalising world. The country has been actively engaged in FTAs through its membership in ASEAN as well as on a bilateral basis. Brunei through ASEAN has concluded FTAs with a number of countries including Australia and New Zealand, China, India, Japan and South Korea.
Brunei is the country coordinator for the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) and its upgrade negotiation which started in 2021. The following year on November 13, the three parties announced substantial conclusion of the negotiations to upgrade AANZFTA. The upgraded AANZFTA will open up new opportunities as new elements have been incorporated into the agreement such as micro, small and medium enterprises (MSMEs) as well as trade and sustainable developments.
With the upgrade, the agreement maintains its high standard, is responsive towards emerging challenges, takes into account modern trade practices and remains commercially meaningful to businesses in the region. The upgraded AANZFTA is also expected to facilitate growth and development of an inclusive and sustainable regional economy.
Meanwhile, the Regional Comprehensive Economic Partnership (RCEP) entered into force on January 1, 2022 for Brunei, Australia, Cambodia, China, Japan, Laos, New Zealand, Singapore, Thailand and Vietnam, followed by other countries at a later date.
The RCEP agreement involves all 10 ASEAN member states and five of its major trading partners – Australia, New Zealand, Japan, China and South Korea. With this agreement, ASEAN resolves to keep markets open while strengthening regional economic integration towards post-pandemic inclusive recovery.
As the world’s biggest free trade agreement, RCEP will facilitate global value chains and trade within the region. The entry into force of the RCEP agreement will pave the way for the creation of a free trade area that covers 30 per cent of global gross domestic product (GDP) and 30 per cent of the world population, in addition to accounting for almost a third of global FDI inflows and over one-quarter of global trade in goods and services according to World Bank data. Non-RCEP companies can also take advantage of RCEP benefits by locating and operating in the region.
The government previously said signing the RCEP would support the region’s post-pandemic recovery efforts while strengthening economic and trade links. Each member of RCEP is expected to gradually eliminate tariffs on over 90 per cent of goods traded within the bloc over 20 years.
With all of the RCEP participating countries already a trade partner for Brunei, the signed agreement further signifies Brunei’s commitment to heighten trade relations and flows. With the agreement in place, Brunei is working to ensure that its infrastructure is up to date and on par with the standards of other RCEP countries. In line with this effort, Brunei has launched the Brunei Darussalam National Single Window (BDNSW), a one-stop portal enabling applicants to submit standardised information and documents to meet legal import, export and customs-transit requirements.
The RCEP will also help improve market access thus creating more opportunities for local SMEs to enter the global market and export their products internationally.
Copyright 1993 Borneo Bulletin Yearbook All rights reserved.