Kuala lumpur: ASEAN must address the immediate fallout from the rise in tariffs by defining the rules of origin more clearly, closing transhipment loopholes, and developing trade diversion safeguards, said Bank Negara Malaysia (BNM) Governor Datuk Seri Abdul Rasheed Ghaffour. He emphasized that the primary objective is to facilitate genuine trade and manage excess capacity from this region and its surroundings.

According to BERNAMA News Agency, Abdul Rasheed highlighted the importance of deepening regional integration and promoting pragmatic multilateralism over the long term. This involves accelerating the implementation of key trade agreements such as the upgraded ASEAN Trade in Goods Agreement (ATIGA), the ASEAN Regional Comprehensive Economic Partnership (RCEP), and the soon-to-be-completed ASEAN Digital Economy Framework Agreement (DEFA).

Abdul Rasheed asserted that these agreements could significantly elevate intra-regional sourcing, reduce business costs, and bolster intra-regional trade and investment. He stressed that diversifying and strengthening trade partnerships, especially with advanced and emerging economies, is not merely a hedge against uncertainty but a strategic recovery approach.

He also noted the extensive ties ASEAN holds with China, Japan, and Korea, which go beyond cultural and value-based connections and extend into value chains across various industries. Institutions like the Asian Infrastructure Investment Bank have committed up to US$50 billion in climate-related projects across ASEAN, while the Japan-ASEAN Integration Fund has provided over US$894 million in grants for economic integration, disaster management, and human capital development since 2006.

Beyond Asia, Abdul Rasheed pointed out the potential benefits of deepening agreements with the European Union (EU) and Latin America, offering a clear path to diversifying partnerships and unlocking new growth areas. He mentioned that ASEAN-EU trade already exceeds US$200 billion annually, making ASEAN the EU’s third-largest trading partner. While trade with Latin America stands at around US$32 billion, there is genuine potential for growth.

By advancing high-standard, mutually-recognized trade agreements with blocs like the South American trade bloc (MERCOSUR), Abdul Rasheed believes ASEAN can establish itself as a credible and competitive global partner.