FTA to Cover More Product Categories
The signing of the protocol by Hong Kong to expand the coverage of specified product categories in its free trade agreement (FTA) with the Association of Southeast Asian Nations (ASEAN) on January 9, 2024, marks a significant development in trade relations. Here are some key points:
Product Category Expansion: The protocol aims to almost triple the range of specified product categories covered by the FTA. This expansion will update the product-specific rules of origin (PSR), increasing coverage from over 200 categories to nearly 600.
Hong Kong-Originating Status: The protocol allows Hong Kong businesses to more easily attain Hong Kong-originating status for a wider range of products. This status enables them to enjoy preferential tariff treatment when exporting these products to the ASEAN market.
Business Opportunities: The specified products incorporated into the FTA encompass various categories such as jewelry, medicaments, food products, and textile products. This broadening of covered categories is expected to enhance the competitiveness of these products and boost trade flows.
Preferential Tariff Treatment: Hong Kong businesses, by gaining Hong Kong-originating status for an increased number of products, will benefit from preferential tariff treatment when entering the ASEAN market. This advantage is likely to facilitate market expansion and increase the attractiveness of Hong Kong products to ASEAN consumers.
Trade Relations with ASEAN: ASEAN is highlighted as Hong Kong’s second-largest trading partner in merchandise trade. The FTA has played a pivotal role in fostering trade relations, contributing to the growth of trade between Hong Kong and ASEAN countries.
Importance of the FTA: Secretary for Commerce & Economic Development Algernon Yau emphasizes the significance of the FTA in consolidating Hong Kong’s position as an international trade center. The FTA has contributed to the upliftment of trade between Hong Kong and ASEAN, showcasing its importance in facilitating international commerce.
Implementation: Both Hong Kong and ASEAN express their commitment to working closely to ensure the early implementation of the protocol. The prompt implementation is crucial for Hong Kong exporters to start benefiting from the expanded coverage and preferential tariff treatment.
In summary, the protocol’s signing reflects a strategic move by Hong Kong to strengthen its economic ties with ASEAN, providing businesses with more opportunities and reinforcing the city’s role as a key player in international trade.
