EU businesses want Asean FTA despite bilateral trade progress

JAKARTA: European businesses are pushing the European Union (EU) to pursue a region-to-region free trade agreement (FTA) with Asean.

According to a new business survey, a broader pact would deliver greater benefits than a patchwork of bilateral deals, and help close a competitiveness gap with rivals.

Nearly three-quarters of respondents in the survey said an EU-Asean regional trade pact would offer greater advantages than bilateral agreements, while half wanted negotiations to start in 2027, when the two regions mark 50 years of diplomatic ties, the 2026 EU-Asean Business Sentiment Survey showed.

“If Europe wants to remain competitive in one of the world’s fastest-growing regions, it needs a broader and more ambitious economic strategy towards Asean,” EU-Asean Business Council executive director Chris Humphrey said.

The survey, conducted from April 16 to July 3, drew responses from 148 senior European business representatives, covering 800 reported market presences across the region.

European companies saw themselves at a disadvantage against competitors from countries that already have trade agreements with Asean, with 88% of respondents citing the gap.

Only Singapore and Vietnam currently have FTAs in force with the EU, while Indonesia finalised negotiations on the Comprehensive Economic Partnership Agreement in 2025, with signing targeted for October this year.

Meanwhile, negotiations with the Philippines and Thailand are targeted for completion by the end of 2026, and Malaysia in 2027.

“Bilateral FTAs are viewed as important near-term tools for improving market access, but not as substitutes for a region-to-region agreement,” the 2026 EU-Asean Business Sentiment Survey showed. — The Jakarta Post/ANN