Milan: Rising trade protectionism is disrupting global trade, leading to economic fragmentation that affects trade, investment, and capital flows throughout the region. This was the conclusion of the 28th ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting (AFMGM+3), which took place on May 4, 2025, in Milan, Italy.
According to BERNAMA News Agency, the meeting was co-chaired by Malaysia’s Finance Minister II Datuk Seri Amir Hamzah Azizan, Bank Negara Malaysia governor Datuk Seri Abdul Rasheed Ghaffour, China’s Finance Minister Lan Fo’an, and the People’s Bank of China governor Pan Gongsheng. Also in attendance were the ASEAN+3 Macroeconomic Research Office (AMRO) director, the Asian Development Bank (ADB) president, the ASEAN Secretariat deputy secretary-general, and the International Monetary Fund (IMF) deputy managing director.
In a joint statement, AFMGM+3 highlighted that near-term economic prospects could be further compromised by external risks such as tighter global financial conditions, a growth slowdown in major trading partners, and reduced investment flows. The group emphasized the need for enhanced regional unity and cooperation to navigate the heightened uncertainty.
The group stated, “Our current policy priority is to reinforce long-term resilience while maintaining flexibility to address near-term challenges, including rising protectionism and volatile global financial conditions.” They expressed a commitment to rebuilding policy buffers and providing targeted support to sustain growth while implementing structural reforms.
AFMGM+3 also stressed the importance of maintaining exchange rate flexibility as a buffer against external shocks. They noted that domestic demand and intraregional trade have become significant drivers of growth, diversifying export markets and sources of growth.
The statement reaffirmed a full commitment to multilateralism and a rules-based, non-discriminatory trading system, with the World Trade Organisation at its core. The group aims to enhance macro-economic policy dialogue, promote regional financial cooperation, and ensure stable industrial and supply chains to safeguard regional economic stability.
The group also urged international organizations to uphold multilateralism and promote free trade, calling for analysis and monitoring of trade tensions’ potential impact on the global economy. They emphasized supporting member countries with policy advice to manage negative shocks.
AFMGM+3 expressed their intent to promote greater intra-regional trade and investment flows to strengthen resilience against external shocks and support sustainable economic development. They are closely monitoring regional financial market conditions and reaffirming their commitment to ensuring resilient financial systems and markets amidst uncertainty.