AANZFTA: Where Australia’s history and geography meet
17 Jul 2019
This year marks the 10th birthday of the ASEAN-Australia-New
Zealand Free Trade Agreement (AANZFTA).
In today’s environment of fractious global relations, this 12-country
agreement between the Association of Southeast Asian Nations (ASEAN),
Australia and New Zealand stands out as an important meeting of minds on
the rewards that come with free trade.
Over 600 million people call the countries covered by AANZFTA home. Over
the past 10 years, people in this region have enjoyed economic growth that
has been the envy of the world. Growth on this scale comes from what the 12
member countries have to offer each other and the rest of the world:
Sophisticated services, including the financial and health services sectors of Singapore and
Abundant agricultural resources
in Australia, New Zealand, Indonesia and Vietnam
Globally recognised manufacturing skill
in Thailand and Vietnam
Rich resource deposits
in Malaysia, Australia and Indonesia.
AANZFTA’s 10th birthday is therefore an opportunity to recognise
the many happy returns underpinned by this commercial agreement.
Formalising the informal
Despite the relative youth of the AANZFTA agreement, ASEAN nations are
actually among Australia’s oldest commercial partners.
From the Makassans of Indonesia trading with the people of Arnhem Land, to
colonial trade routes linking our vast continent to Singapore and Malaysia,
we’ve long exchanged valuable goods and services with our neighbours to the
But the inking of AANZFTA a decade ago marked a new phase in our engagement
with South East Asia – a renewed commitment from both sides. Since its
inception, ASEAN has purchased A$350 billion in Australian exports. This
equates to 10% of Australian goods exports, and 16% of Australian services
In 2018, ASEAN was Australia’s third-largest trade partner. Member
countries purchased A$52 billion in goods and services from Australia –
more than the sum of our exports to the United States and South
A watching brief
Importantly, the AANZFTA agreement introduced regional rules of origin.
These region-wide rules encourage Australian companies to be ambitious and
consider the region as one turf for our economic activities. This resonates
today, with 45% of Australian businesses saying ASEAN economic integration
is important to doing business in the region.
With a favourable demographic profile, encouragement of international trade
and policy oriented towards the creation of a single market, ASEAN has
developed into an attractive commercial partner. This stands out in today’s
increasingly volatile trading environment.
Today, 12,448 Australian goods exporters sell into ASEAN, which is more
than those selling to the United States. In addition:
Almost one-third of Australian–ASEAN exporters sell to more than one
- ASEAN is a leading destination for Australian direct investment, with
Australian companies reporting A$40 billion of investment stock in 2018
- ASEAN is Australia’s largest source of tourists with 1.44 million
visiting our shores in 2018 – this roughly equals arrivals from China and
exceeds arrivals from New Zealand 
- The ASEAN region accounted for around 139,000 enrolments in Australian
educational institutes in 2018, second behind China.
On the tenth anniversary of its signing, AANZFTA has proved itself to be a
positive platform for regional engagement
. As one of Australia’s most important trade agreements, it both reflects
our history and charts a course for the future.