UK eyes trade agreement with Asean after it leaves European Union

Trade and Industry Secretary Ramon M. Lopez said that the United Kingdom (UK) has expressed interest to pursue a regional trade agreement with the Association of Southeast Asian Nations (Asean), weeks after the European Union (EU) expressed intent to do the same.

Lopez told the Inquirer that UK’s International Trade Secretary Liam Fox announced that they would like to have a free trade agreement with the Asean after Brexit, noting that the UK was not allowed to make any trade negotiations while its divorce from EU was ongoing.

Fox visited the Philippines last April 3 to 4, making the country the first Asean member that the cabinet official visited after UK formally notified EU of its plan to leave the economic bloc. Lopez said he was informed about this intent during the visit in his position as this year’s Asean chair.

“UK said it can explore with Asean FTA as they Brexit,” Lopez said in a text message yesterday.

He said that a regional trade deal would be more efficient to pursue because that would mean an FTA with “10 countries instead of one at a time.”

UK and the EU, which will one day be divorced from each other, seem to have their eyes set on the Asean market, which has a combined economy of $2.6 trillion and a market of 600 million people.

In March, the Asean Economic Ministers, together with EU Trade Commissioner Cecilia Malström, announced that they would eventually go back to the negotiating table for a regional trade deal, years after the initiative was dropped to focus on bilateral FTAs.

It would still take time for details to be fleshed out of the regional deals, with EU and Asean in the midst of crafting the framework of the agreement while it would take at least two years for UK to leave the European bloc.

Prior to this, British Ambassador to Manila Asif A. Ahmad said that the UK was interested in having an FTA with the Philippines after Brexit. He said they would adopt the terms of the EU-PH FTA, should it be completed during the two-year period.

However, Lopez suggested that the bilateral trade deal between UK and the Philippines might have to be dropped since the Philippines would still be engaged in the proposed UK deal “via the Asean.”