ASEAN-Japan Economic Relation

Overview

Japan’s formal relationship with ASEAN was first established in 1977 as among the first ASEAN’s Dialogue Partners. According to preliminary ASEAN data, total merchandise trade between ASEAN and Japan reached USD 225.9 billion in 2019, accounting for 8.0 per cent of ASEAN’s total merchandise trade, while total Foreign Direct Investment (FDI) inflows from Japan amounted to USD 20.4 billion, accounting for 12.7 per cent of total FDI inflows to ASEAN. This placed Japan as ASEAN’s fourth largest trading partner and second largest external source of FDI among ASEAN’s Dialogue Partners in 2019.

The Framework for Comprehensive Economic Partnership between ASEAN and Japan was signed by leaders at the ASEAN-Japan Summit on 8 October 2003 in Bali, Indonesia, and was aimed at establishing a Comprehensive Economic Partnership agreement between ASEAN and Japan.

The Agreement on Comprehensive Economic Partnership among Japan and Member States of the Association of Southeast Asian Nations (AJCEP) was concluded in November 2007 in Manila, and signing was completed ad-referendum by 14 April 2008. It entered into force, depending on the Party, between 1 December 2008 and 1 July 2010.

The AJCEP enabled businesses from ASEAN and Japan to gain access to a big and potential regional market of 752.4 million people and to benefit from tariff concessions and cumulative rules of origin. All of which would provide consumers with greater choice of products with competitive prices.

In 2017, the Parties agreed to complement the Agreement with the completion of chapters on trade in services, movement of natural persons, and investment. In order to incorporate these chapters, all Parties signed the First Protocol to amend the Agreement between 27 February and 24 April 2019. The First Protocol entered into force on 1 August 2020 among Japan, Lao PDR, Myanmar, Singapore, Thailand and Viet Nam, and on 1 October 2020 for Brunei Darussalam.

Priority Areas of Cooperation

The AJCEP aims to liberalize and facilitate trade in goods between ASEAN and Japan and promoting cooperation in fields such as Information and Communications Technology, Intellectual Property, and SMEs. The parties will also continue to discuss and negotiate improvements to the chapters on Trade in Services and Investment.

The AJCEP is comprehensive in scope and covers a broad spectrum of areas, with standalone chapters/ annexes including:

Trade in goods
Rules of origin
Sanitary and phytosanitary measures
Standards, technical regulations and conformity assessment procedures
Trade in services
Investment
Economic cooperation
Settlement of disputes

Major Sectoral Bodies/Committees

The primary element of the institutional structure is the AJCEP Joint Committee (JC), which reports regularly to the consultations of the ASEAN Economic Ministers, and Japan’s Minister of Economy, Trade and Industry (AEM-METI) through the meetings of their Senior Economic Officials (SEOM-METI).

A number of subsidiary bodies to the AJCEP JC were established under the Agreement. Article 11 of the Agreement provides for the JC to establish additional subsidiary bodies (including ad hoc bodies) and assign them with tasks on specific matters, or delegate its responsibilities to any subsidiary body.

Key Documents

Agreements:

First Protocol to Amend the Agreement on Comprehensive Economic Prtnership among Member States of the Association of Southeast Asian Nations and Japan

ASEAN-Japan Agreement on Comprehensive Economic Partnership (2008)

ASEAN-Japan Framework for Comprehensive Economic Partnership (2003)

Amended AJCEP Implementing Regulations
- CO Format for ASEAN Member States
- CO Format for Japan

Other Relevant Documents
- Annex 2 – Product Specific Rules (HS 2017)

Statements/ Press Releases:

AEM-METI Joint Media Statement

Announcement on a Revised ASEAN Version of the Certificate of Origin Form under the AJCEP (2014)

Joint Declaration of the Leaders of ASEAN and Japan on the Comprehensive Economic Partnership (2002)

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