Agri-Food Trade Service

Agri-Food Regional Profile
ASEAN

May 2011

The Government of Canada has prepared this report based on primary and secondary sources of information. Readers should take note that the Government of Canada does not guarantee the accuracy of any of the information contained in this report, nor does it necessarily endorse the organizations listed herein. Readers should independently verify the accuracy and reliability of the information. This report is intended as a concise overview of the market for those interested in its potential and is not intended to provide in-depth analysis which may be required by the individual exporter. Although every effort has been made to ensure that the information is correct, Agriculture and Agri-Food Canada assumes no responsibility for its accuracy, reliability, or for any decisions arising from the information contained herein.

Please address any comments or suggestions you have on this report to: Ben Berry – ben.berry@agr.gc.ca

Table of Contents

Executive Summary
ASEAN Overview
Canada – ASEAN Relations
Agricultural Trade
Agriculture Sector and Policies
Economy
Investment
Consumer Market
Opportunities
Trade
Competitors
Business Travel Tips
Access Issues
Further Information
Key Resources

Executive Summary

• In 2007, Canada and ASEAN celebrated 30 years of dialogue relations.
• Canada has identified ASEAN as a global commerce strategy priority market, with agriculture, food and beverages as a sector of interest.
• In 2010, bilateral agricultural trade between ASEAN and Canada was valued at $1.5 billion, giving Canada a positive trade balance of $123 million.
• Canada's major exports to ASEAN are concentrated on two bulk commodities, wheat and soya beans, which represented 54.7% of Canada's total agri-food exports in 2010.
• Agriculture accounts for over 25% of GDP in several ASEAN member states, such as Burma (Myanmar) (50%), Cambodia (33.4%) and Laos (29%). It also contributes significantly to GDP in Indonesia (15.3%), Thailand (12%), Vietnam (20.7%) and the Philippines (20%).
• Laos, the Philippines and Thailand all had very high GDP growth rates in 2010, at 7.7%, 7.0% and 7.5% respectively.
• Southeast Asia offers a lucrative export market for a wide range of agricultural products. Diverse countries with varying ethnicities present demand for different and unique products.
• Processed foods are gaining popularity in several of the more affluent ASEAN member states, providing a market opportunity for packaged and processed foods.
• In 2009, the top four most attractive investment destinations in ASEAN were not limited to the most affluent member countries, and included Singapore (41%), Vietnam (19%), Thailand (15%) and Indonesia (12%).

ASEAN Overview

The Association of Southeast Asian Nations (ASEAN) is a geopolitical and economic organization spread over a wide and diverse region with a population of approximately 600 million. The Association includes 10 countries, namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar (Burma), the Philippines, Singapore, Thailand and Vietnam. As of 2009, ASEAN's collective GDP equalled nearly $1.5 trillion. ASEAN celebrated its forty year anniversary in 2007, with the theme "One ASEAN at the Heart of Dynamic Asia".

In recent years, ASEAN has focused on deepening relations with trade partners. Over the last two decades, the organization has become increasingly interested in the further economic integration of its members. ASEAN member states are a highly heterogeneous group, with political structures ranging from democracies to military leaderships.

Although the region is relatively poor by Western standards, ASEAN member states demonstrate strong GDP growth. The region did well during the global economic recession, with Brunei Darussalam, Cambodia, Malaysia, Singapore and Thailand seeing slightly negative GDP growth, while Indonesia, Laos, Burma (Myanmar), the Philippines and Vietnam showed positive growth. All countries retained positive growth rates in 2010, a trend which is expected to continue through 2015.

Background

ASEAN was created in 1967 in Bangkok, Thailand, with the signing of the ASEAN Declaration. The original founding members of ASEAN include Indonesia, Malaysia, the Philippines, Singapore and Thailand. ASEAN has since expanded its membership to include Brunei Darussalam (1984), Vietnam (1995), Laos (1997), Burma (Myanmar) (1997) and Cambodia (1999).

The ASEAN Declaration states that the aims and purposes of the Association are to accelerate economic growth, social progress and cultural development in the region; and to promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries in the region and adherence to the principles of the United Nations Charter.

ASEAN's Charter came into force in December 2008, establishing ASEAN as an international legal entity. The Charter brought about several changes in the Association, with the establishment of a new legal framework and the addition of several new units that will serve to boost ASEAN's community-building process.

Geography

One of the main factors that contributed to the development of ASEAN was the geographical proximity of its member states. The region has great geographical variations, as it located between India and China. The region is further connected by a collection of large river basins sloping south and east, a number of peninsulas and archipelagos, and seas that exist between islands and are connected by straits of various widths. The members range in physical size from the 2 million sq. km of Indonesia to the 710.3 sq. km of Singapore.

Agricultural trade is of large importance to ASEAN, as it has a large agricultural foundation and arable land mass encompassing over 62 million hectares. By far, the largest agricultural land holders are Indonesia and Thailand. Climate ranges within each individual country from tropical and humid along the coasts and inner plains to monsoon rains during the summer months. The members of ASEAN are rich in natural mineral resources. Natural resources found within the region include offshore oil and gas deposits, natural gas, water, fish, timber, coal, iron ore, tin, zinc, copper, lead, manganese, phosphate, gemstones and precious stones.

Political Structure

The political systems in ASEAN member countries are diverse. The Declaration established by the founding members in 1967 does not call for common political positions of ASEAN member states. As such, the region is characterized by an assortment of political systems, ranging from a military junta in Burma (Myanmar), socialist governments in Vietnam, Laos and Cambodia, a sultanate in Brunei and democratic governments in the Philippines, Indonesia, Malaysia, and Singapore.

In 2003, the ASEAN Leaders established three pillars of integration for the ASEAN Community which includes the ASEAN Security, Economic and Socio-Cultural Communities. The ASEAN Economic Community shall establish ASEAN as a single market and production base, turning the diversity that characterizes the region into opportunities for business and making ASEAN a more dynamic and stronger segment of the global supply chain.

The ASEAN Charter sets the framework and lays the legal foundation for ASEAN to restructure its existing mechanisms and improve its decision-making process to enhance efficiency and ensure prompt implementation of all ASEAN agreements and decisions. It is hopeful that this Charter will help ASEAN remain an integrated player on the international stage and address challenges among member countries.

Canada – ASEAN Relations

In 2007, Canada and ASEAN celebrated 30 years of Canada-ASEAN dialogue relations. Canada's relations with ASEAN are guided by a Joint Cooperation Work Plan, which provides a framework for undertaking initiatives in a range of areas of mutual interest, including: counter-terrorism, health security, inter-faith dialogue, disaster management, cooperation in multilateral fora, and trade and investment facilitation. Canada and ASEAN signed a Joint Declaration for Cooperation to Combat International Terrorism in July 2006, and Canada attends the annual ASEAN Post-Ministerial Conference and the ASEAN Region Forum. Canada also hosted the Canada-ASEAN Dialogue in 2007. ASEAN and Canada are working towards establishing a Canada-ASEAN Trade and Investment Framework Arrangement (TIFA) that will enhance trade and investment relations.

Canada has identified ASEAN as a global commerce strategy priority market, with agriculture, food and beverages as a sector of interest.

Economic relations between Canada and ASEAN continue to grow and expand. In 2009, total Canada-ASEAN trade totalled US$9.03 billion.

Agricultural Trade

In 2010, bilateral agricultural trade between ASEAN and Canada was valued at $1.5 billion. Canada exported a total of $795.5 million worth of agricultural products to ASEAN, a slight decrease from 2009. The top ASEAN destinations for Canadian agri-food exports included Indonesia, the Philippines and Malaysia.

Total agricultural exports to the region fluctuated between 2007 and 2010. Total exports from Canada in 2007 were valued at $1.0 billion, while they decreased 30% between 2008 and 2009, likely a cause of the global economic recession. However, exports appeared to recover in 2010, increasing by 9%.

• Canada's major exports to ASEAN are concentrated on two bulk commodities, wheat and soya beans, which represent 43.6% and 11.1% of Canada's total agri-food exports respectively.
• Other notable exports to ASEAN countries in 2010 included animal feed preparation (6.3%), frozen swine cuts (4.9%) and fresh or chilled swine cuts (2.6%).

Canada imported nearly $666.5 million in agricultural products from ASEAN in 2010. This was a slight increase from 2009. Thailand was the largest source of imports accounting for over 38% of imported agricultural products into Canada, at a value of $256.0 million. There were low levels of imports from Laos and Cambodia.

Like exports to ASEAN, imports also fluctuated slightly between 2007 and 2010. Both exports and imports increased between 2007 and 2008, the time of the global financial recession, and then decreased in 2009.

• Total agri-food imports from ASEAN in 2010 totalled $666.5 million.
• Major imported products in 2010 included rice, which represented 14.1% of total imports to ASEAN, palm oil (9.8%), vegetable fats and oils (4.9%), cashew nuts (4.8%) and coffee (3.9%).

Canada-ASEAN bulk, intermediate and consumer exports

Canadian intermediate exports to ASEAN have fluctuated over the years. Exports jumped 23% in 2008, and then decreased 21% in 2009. This decrease is likely a result of the global economic downturn, as exports bounced back in 2010 by 74%. Principal intermediate exports to ASEAN in 2010 consisted of animal feed and preparation, accounting for 31.2% of intermediate exports, rape/colza seed oil-cake (10.7%), canola (10.0%), peas (9.7%) and bovine hides (8.7%).

Consumer exports have also been inconsistent over the years, increasing 62% from 2007 to 2008, and then decreasing 8% between 2008 and 2010. Major consumer exports to ASEAN included frozen swine cuts, accounting for 20.8% of total consumer exports, fresh or chilled swine cuts (11.2%), frozen chicken and capon cuts and edible offal (8.9%), potatoes (8.5%) and food preparations (6.4%).

Bulk exports have traditionally been the largest export type to ASEAN. Canadian bulk exports appeared to be impacted significantly by the financial crisis, decreasing 39% from 2008 to 2009. Exports of this type continued decreasing in 2010, by 15%. The largest bulk export continues to be wheat and meslin, which represented 77.5% of total bulk exports to ASEAN. Soya beans (19.8%) remain the second largest bulk export, followed by tobacco (0.9%), durum wheat (0.6%) and barley (0.4%).

Agriculture Sector and Policies

Agriculture is an important and dominant sector in ASEAN countries, contributing heavily to GDP and employment. The region has a large agricultural foundation and over 60 million hectares of arable land with the largest agricultural land holders being Indonesia and Thailand. Within the last decade, ASEAN countries have rapidly increased production and consumption of agricultural products.

The majority of ASEAN member states rely heavily on the agriculture sector for GDP growth, trade and investment. Agriculture accounts for a significant amount of GDP in Burma (Myanmar) (50% of GDP), Cambodia (33.4%) and Laos (29%). It also contributes significantly to GDP in Indonesia (15.3% of GDP), Thailand (12%), Vietnam (20.7%) and the Philippines (20%). Agricultural and food trade is considered vital for ASEAN countries as many see the expansion of agricultural production and trade as essential to reducing rural poverty. Agriculture and food imports provide food security, which is also a high priority for ASEAN countries. Several ASEAN countries (e.g., Indonesia and Malaysia) have been able to almost double their share of global agri-food trade during the past decade. Food safety, both for domestic and export markets, is an increasingly important issue among ASEAN countries, but overall standards continue to lag behind Western levels. For an open market like Singapore, agricultural and food trade provides inputs for food processing industries or other value-added opportunities for export to ASEAN markets.

ASEAN cooperation in food, agriculture and forestry is focused on formulating and implementing regional cooperation activities to enhance the international competitiveness of ASEAN's food, agriculture and forestry products in addition to strengthening food security in the region. Through its Economic Community blueprint, ASEAN members are attempting regional integration of agro-based products. The seven priority areas for ASEAN food, agriculture and forestry include:

• Strengthening food security
• Facilitating trade in agriculture and forestry products
• Generating and transferring technology to increase productivity and develop agribusiness
• Developing rural communities and human resources
• Involving and investing in the private sector
• Managing and conserving natural resources for sustainable development
• Strengthening ASEAN cooperation in addressing regional and international issues.

• The main agriculture products of Indonesia are rice, cassava (tapioca), peanuts, rubber, cocoa, coffee, palm oil, copra, poultry, beef, pork, and eggs.
• Malaysia's main agricultural products include rubber, palm oil, cocoa, rice, timber, coconuts, tropical fruit and fish.
• The Philippines' agriculture sector is an integral component of its economy, accounting for just under 20% of GDP. Its main agricultural commodities include sugarcane, cassavas, coconuts, rice, corn, bananas, pineapples, mangos, eggs, pork, beef and fish.
• Thailand's agricultural sector accounts for 12% of GDP and employs 40% of the workforce. It is the largest exporter on the world rice market. Thailand's main agricultural products include rice, tapioca, rubber, fish and seafood, corn, sugarcane, coconuts and soybeans.
• Vietnam today is one of the world's largest exporters of rice and coffee with other key agricultural commodities including cashews, maize, pepper, sweet potato, pork, peanuts, cotton and fish and shellfish.
• The agricultural sector in Laos employs roughly 75% of the population and accounts for 29% of the country's total GDP. Major agricultural products include glutinous rice, coffee, corn, sugarcane, vegetables, tobacco, ginger, water buffalo, pigs, cattle, poultry, sweet potato, cotton, tea and peanuts.
• Agriculture in Cambodia accounts for 33.4% of GDP, with rice, rubber, corn, meat, vegetables, dairy products, sugar and flour as major agricultural products.
• Brunei's economy is mostly reliant on oil and gas, which account for almost all exports. The government has selected agriculture, aquaculture and fisheries as sectors of high priority to diversify the economy. Farming is largely limited to yams, bananas and cassava.
• Singapore is the only country within ASEAN with little to no agricultural output due to the size of the populated urban island. Agriculture accounts for less than 0.5% of GDP.
• Main agricultural products in Burma include rice, pulses, beans, sesame, peanuts and sugarcane.

For further information on the agricultural sector of ASEAN's key markets please view the Agri-Food Trade Service (ATS) Country reports on Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam: www.ats-sea.agr.gc.ca/info/info-ase-eng.htm

Economy

The Association is making progress towards building greater economic integration through the ASEAN Economic Community which will help foster economic growth in the ASEAN countries with lower levels of development. In 1997 the ASEAN leaders agreed upon the ASEAN Vision 2020 which is a shared vision of ASEAN as a group of Southeast Asian nations that are outward looking, bonded together by partnerships in dynamic development and the common goal of sustaining a community of caring societies. Its goal is to create a stable, prosperous and highly competitive ASEAN economic region in which there is a free flow of goods, services, investment and a freer flow of capital, equitable economic development and reduced poverty and socio-economic disparities in year 2020.

The Asian Financial Crisis of the late 90s caused several countries in the ASEAN region to experience economic volatility. Since then, the affected ASEAN members have made enormous progress towards economic integration and currency stabilization. However, there are very different levels of development among members.

With regards to the global financial crisis of the late 2000s, the GDP per capita of several ASEAN member states decreased. However, the countries recovered quickly, and GDP per capitas are once again on the rise. This trend is expected to continue for the majority of ASEAN member states.

The ASEAN economy is characterized by a stop and start cycle of demand, making the economy somewhat tumultuous. However, increasing affluence in these countries has led to slower population growth and a more stable economy. Sound domestic demand and intra-regional trade will continue to be strong drivers for regional growth through the next couple of years with India and China propelling the region.

Current

• GDP growth in all ASEAN member states is positive as the region recovers from the financial crisis.
• Singapore led the region in 2010 with 15% GDP growth.
• Laos, the Philippines and Thailand all had very high growth rates in 2010, coming in at 7.7%, 7.0% and 7.5% respectively.
• Malaysia's GDP growth rate recovered extremely well after the global economic downturn, increasing from -1.7% in 2009 to 6.7% in 2010.
• The global financial crisis caused several ASEAN members to see high inflation rates. Cambodia and Vietnam had the highest, at 25%, 22.5% and 23.1% respectively. Due to their quick recovery, inflation decreased to -0.7% in Cambodia and 6.7% in Vietnam.
• All ASEAN members have relatively low unemployment rates, with the highest being 7.5% in Indonesia.

Forecast

• GDP growth is expected to remain positive in all ASEAN member states after 2010. Laos, Cambodia and Vietnam are projected to have the highest growth rates, at 7.5%, 6.8% and 6.8% respectively in 2011. Laos is expected to sustain growth above 7% until 2015, while Vietnam's growth will continue to increase to over 7% in 2012 and Cambodia will see growth over 6% until 2015.
• Thailand recovered extremely quickly after the economic turndown, with GDP growth going from -2.2% in 2009 to 7.5% in 2010. The growth rate is expected to decrease to 4% in 2011, but will then continue in an upward trend.
• Indonesia maintained a positive growth rate during the recession, and the recovery of its fellow ASEAN members and trading partners has put its growth on an increasing trend, remaining over 6% until 2015.
• Inflation will be stable for all ASEAN member states, and will decrease in most cases.
• Unemployment rates are expected to either decrease or remain stable, with all countries seeing rates under 10%.

Investment

The ASEAN Investment Area (AIA) agreement signed on October 1998 was an important milestone to stimulate the surge of investment into ASEAN member countries. With the integration of the economies of the member countries, ASEAN has attracted unprecedented foreign direct investment. Foreign direct investments (FDI) play an integral role in the rapid economic development of the newly industrializing and developing economies of Southeast Asia. FDI constitutes a considerable share among the components of resource flows to the ASEAN countries, indicating the importance of FDI as a major source of finance for economic development.

FDI in ASEAN was affected by the global financial crisis, but still remained strong. The largest investors in ASEAN are the European Union, which accounted for 18.3% of FDI, Japan (13.4%), sources within the region (11.2%) and the United States (8.5%). In 2009, Canada's foreign direct investment (FDI) in the region accounts for 0.8% of total ASEAN FDI, ort $7.2 billion, while ASEAN FDI in Canada totalled $446 million.

The amount of FDI in the region varies between countries. In 2009, the top four most attractive investment destinations were Singapore, which accounted for 41% of total ASEAN FDI, Vietnam (19%), Thailand (15%) and Indonesia (12%). However, Cambodia, Laos and Vietnam are becoming increasingly appealing to investors, accounting for 23% of total ASEAN FDI flows in 2009.

Canada is negotiating Foreign Investment Promotion and Protection Agreements (FIPA) with several ASEAN countries, including Indonesia and Vietnam, and has already concluded negotiations with the Philippines and Thailand. In addition, Canada is negotiating a Free Trade Agreement (FTA) with Singapore.

Consumer Market

Southeast Asia offers a lucrative export market for a wide range of agricultural products. The region is diverse in terms of ethnicity and style of cuisine. As such, each community in each country presents demand for a wide array of products. This provides ample opportunity for exporters to supply a variety of products targeted at unique populations.

There is growing demand for halal food, which is prepared according to Islamic standards, and is considered safe and not harmfully prepared. As the Asia-Pacific region has the largest population of Muslims in the world, halal certified food and beverage products are in high demand. The region is home to more than 1 billion Muslims, with Indonesia ranking as one of the four largest countries in terms of Muslim population. In Southeast Asia, halal guidelines are rigorously applied in both Malaysia and Brunei, and are widely adhered to in Indonesia. These countries, along with other member states that have minority Muslim populations, present a large demand for halal food products, as they are prepared according to Islamic standards.

Potential Markets

Several markets in ASEAN provide ample opportunity for Canadian exporters. Chief among them are Indonesia, the Philippines, Malaysia, Thailand, Singapore and Brunei. These countries all have developed consumer markets that continue to develop diversified tastes, causing increased demand for new imported products.

The global health and wellness trend has become popular in these markets, with consumers becoming more aware of the health benefits of certain foods. Products that contain less fat, sugar and sodium are expected to become increasingly popular in these markets. Consumers are also becoming more conscious about food safety, causing increased demand for organic foods. In the Philippines, consumers are increasingly buying processed and packaged foods with low-fat, light and low-sodium labels. Improved health awareness in Thailand has caused increased consumption of healthy drinks such as soy milk, yoghurt drinks and mineral water, while the global health and wellness trend has driven demand for healthy halal products in Brunei.

Both Malaysia and Singapore have large percentages of their populations in urban areas, exposing them to Western tastes and influences. This has led to a rise in demand for processed and packaged foods that better offset increasingly busier lifestyles and increased incomes. Singapore is an especially lucrative market, as close to 100% of its population is urbanized and it possesses the 6th largest GDP per capita in the world.

Emerging Markets

Consumer markets in Cambodia, Laos and Vietnam are becoming more developed as urbanization increases and lifestyles become increasingly busy. Cambodia's consumer market is developing quickly, driven by its young population and annual urbanization rate of 3%. Laos' market also has high potential, with an annual urbanization rate of 5% and a youthful population that is sure to be the driving force behind changes in consumer trends and markets in the upcoming years.

Consumers in Vietnam are well accustomed to imported food products. Increased urbanization and rising per capita incomes have caused demand for new imported products, such as health and wellness food stuffs.

Opportunities

Southeast Asia's diverse and growing consumer market offers several opportunities for Canadian exporters.

• The halal food industry is flourishing in Southeast Asia, as there is a large population of Muslims. Exporters who adhere to halal certification standards will find a thriving market.
• Increased awareness about health has led to wealthier consumers looking for health food and products. As an emerging market, organic food presents a significant opportunity for Canadian exporters.
• Fish and most kinds of meat are popular in the ASEAN member states, and exporters of these products would find a large market with diverse tastes.
• Processed and packaged foods are gaining popularity in several of the more affluent ASEAN member states.
• Southeast Asian nations all prefer fresh food to packaged food, and as vegetables are a staple in the majority of countries, agri-food exporters will find a lucrative market for fresh vegetables.
• ASEAN's middle-income group is displaying a growing demand for imported foods. Canadians exporting wheat and soybeans will see growth in this market. As Southeast Asia is mostly tropical, it has massive shortages of food that must be imported. This is a particularly lucrative market, as Southeast Asian citizens are relatively open to outside brands.
• As the middle and upper income groups continue to grow, the popularity of food service will increase, presenting opportunity for Canadian exporters.
• Specialty food and drink shops are seeing increased popularity in all ASEAN member states, providing opportunity for exporters of this category.
• The retail food market continues to expand, with multinationals present in Malaysia, Thailand and Indonesia; regional Asian supermarkets are present in all countries, excluding Thailand and the Philippines; and local markets still exist in the Philippines and Vietnam.
• Target markets include those who make up the "Heart of ASEAN": Malaysia, Singapore and Brunei, as well as ASEAN dynamos Indonesia and Vietnam, who have major growth potential.
• For further information on the consumer sector of ASEAN's key markets please view the ATS Country reports on Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam: www.ats-sea.agr.gc.ca/info/info-ase-eng.htm

Trade

The ASEAN Free Trade Area (AFTA) was formalized in 1993 to further the elimination of tariff and non-tariff barriers among Member Countries to promote greater economic efficiency, productivity, and competitiveness. The AFTA laid out a comprehensive program of regional tariff reduction, to be carried out in phases through the year 2008. The requirements of the AFTA and bilateral trade agreements have contributed to lower tariffs and greater trade in the region.

As of January 2005, tariffs on almost 99% of the products in the Inclusion List of the ASEAN-6 (Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand) member countries had been reduced to no more than 5% with more than 60% of these products having zero tariffs. The average tariff for ASEAN-6 has been brought down from more than 12% when AFTA started, to 2% today. 

The Common Effective Preferential Tariff (CEPT) Agreement for AFTA requires that tariff rates levied on a wide range of products traded within the region are reduced to 0-5%. For the newer member countries, namely, Cambodia, Laos and Vietnam, tariffs on about 81% of their Inclusion List have been brought down to within the 0-5% range. The ASEAN leaders have agreed to eliminate all import duties by 2010 for the six original members of ASEAN and by 2015 for the new members. Products that remain out of the CEPT-AFTA scheme are those in the Highly Sensitive List (i.e. rice) and the General Exception List.

On May 17, 2010, the ASEAN Trade in Goods Agreement (ATIGA) entered into force. The ATIGA is an enhanced version of the CEPT-AFTA aimed at creating a more comprehensive legal instrument.

Competitors

ASEAN recognizes the potential benefits of furthering co-operation amongst its trading partners and is currently working to advance its free trade arrangements with a number of them. The main objectives of these agreements are to strengthen and enhance economic, trade and investment co-operation between the parties. In 2004 leaders from ASEAN, Australia and New Zealand agreed to launch negotiations for a FTA involving the 10 countries of ASEAN, Australia and New Zealand.

In 2010, ASEAN implemented various FTA agreements with major trading partners. The ASEAN-China Free Trade Area (ACFTA) and the ASEAN-Korea Free Trade Area (AKFTA) were established in January 2010. Other important agreements that came into effect in 2010 were the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA), the ASEAN-India Trade in Goods Agreement and the ASEAN-China Investment.

ASEAN's major trading partners in 2009 were China, representing 12.1% of total ASEAN trade, the European Union (11.6%), Japan (10.8%) and the United States (10.1%). Canada faces tough competition from these countries, as well as other ASEAN members.

Business Travel Tips

• Canadian exporters would benefit from outlining a long term strategy for the ASEAN market, as the economy is, at times, tumultuous.
• Major importers and retailers no longer tolerate unprepared suppliers. Canadian businesses must be ready to weather competition from other countries and adjust accordingly.
• Canadians must listen to local advice and actively seek it out in order to be successful in this market.
• Businesses wishing to export to ASEAN must choose a reliable import distributor and business partner in order to benefit from the market
• Using the Agri-Food Trade Commissioner Team to source trade leads is recommended.

Access Issues

ASEAN is an active member of the World Trade Organization (WTO) and is promoting free trade agreements (FTA) with a number of countries and trading blocs. All Southeast Asian states, with the exception of Laos, have been members of the World Trade Organization since 1995. Vietnam recently joined the WTO in January 2007 following a decade of negotiation process. This is testimony to the progress these countries have made in opening markets, strengthening institutional structures and adopting international standards.

Some competitors who have had success in the ASEAN market include the United Kingdom (UK) with sweet biscuits exports, Belgium with chocolate exports, Italy with pasta exports, Germany with sugar confectionary exports and the United States with processed potato products. These countries have benefitted from ASEAN's modern and sophisticated distribution channels and merchandising practices that facilitate trade in the region.

Further Information

For further information on ASEAN markets, please see the following ATS Country Reports:

Indonesia Agri-Food Past, Present and Future Report – 2010
Malaysia Agri-Food Past, Present and Future Report – 2010
Philippines Agri-Food Past, Present and Future Report - 2010
Singapore Agri-Food Past, Present and Future Report – 2007
Thailand Agri-Food Past, Present and Future Report - 2011
Vietnam Agri-Food Past, Present and Future Report – 2010

For more information on ASEAN please contact:

Canadian Contacts in ASEAN

Canadian High Commission
One George Street #11-01
Singapore 049145
Tel: (65) 6854-5900
Fax: (65) 6854-5915
Email: spore-td@international.gc.ca
Website: www.tradecommissioner.gc.ca/sg
Other URL: www.international.gc.ca/asia/singapore

Trade Commissioners in ASEAN Member States
Brunei - Ms Nurul Salwani Sabtu-Trade Commissioner Agriculture, Food and Beverages
bsbgntd@international.gc.ca

Indonesia - Mr. Hermawan Hermawan-Trade Commissioner-Agricultural Technology and Equipment, Agriculture, Food and Beverages, Bio-Industries, Building Products, Fish and Seafood Products, Forest Industries
hermawan@international.gc.ca

Malaysia - Mrs. Caroline Mourand -Trade Commissioner-Agricultural Technology and Equipment, Agriculture, Food and Beverages, Education, Environmental Industries, Fish and Seafood Products, Service Industries and Capital Projects
Email: Caroline.Mourand@international.gc.ca

Philippines - Ms. Yvette Buendia- Trade Commissioner -Agricultural Technology and Equipment, Agriculture, Food and Beverages, Fish and Seafood Products
infocentre-manila@international.gc.ca

Singapore - Ms. Gretchen Bozak- Trade Commissioner -Agriculture, Food and Beverages, Fish and Seafood Products, Market Access
spore-td@international.gc.ca

Cambodia/Thailand/Laos - Surin Thanalertkul-Trade Commissioner-Agricultural Technology and Equipment, Agriculture, Food and Beverages, Bio-Industries, Fish and Seafood Products, Health Industries
surin.thanalertkul@international.gc.ca

Vietnam - Hanoi - Thu Dang-Anh - Trade Commissioner-Agriculture, Food and Beverages, Environmental Industries, Ocean Technologies
vietnam-infocentre@international.gc.ca

Key Resources

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Association of Southeast Asian Nations. "ASEAN Bulletin." Association of Southeast Asian Nations. N.p., Aug. 2010. Web. 15 Feb. 2011. http://www.aseansec.org/24985.htm.

- - -. "ASEAN Ministerial Meeting on Agriculture and Forestry (AMAF)." Association of Southeast Asian Nations. 2009. Web. 15 Feb. 2011. http://www.aseansec.org/19587.htm.

- - -. "ASEAN Stats." Association of Southeast Asian Nations. 2009. Web. 15 Feb. 2011. http://www.aseansec.org/22122.htm.

- - -. "ASEAN Vision 2010." Association of Southeast Asian Nations. 2009. Web. 15 Feb. 2011.

The Canadian Trade Commissioner Service. Foreign Affairs and International Trade Canada. Web. 15 Feb. 2011. http://www.tradecommissioner.gc.ca.

Country Watch. 2011. Web. 15 Feb. 2011. http://www.countrywatch.com.

Euromonitor International. "Consumer Lifestyles in Indonesia." Euromonitor International. Oct. 2009. Web. 15 Feb. 2011. http://www.euromonitor.com.

- - -. "Consumer Lifestyles in Malaysia." Euromonitor International. July 2009. Web. 15 Feb. 2011. http://www.euromonitor.com.

- - -. "Consumer Lifestyles in Singapore." Euromonitor International. Apr. 2009. Web. 15 Feb. 2011. http://www.euromonitor.com.

- - -. "Consumer Lifestyles in Thailand." Euromonitor International. Feb. 2009. Web. 15 Feb. 2011. http://www.euromonitor.com.

- - -. "Consumer Lifestyles in the Philippines." Euromonitor International. Aug. 2008. Web. 15 Feb. 2011. http://www.euromonitor.com.

- - -. "Consumer Lifestyles in Vietnam." Euromonitor International. Oct. 2008. Web. 15 Feb. 2011. http://www.euromonitor.com.

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