On the other hand, since 2012, exports of products originating from mainland China to ASEAN via Hong Kong have grown at an average annual rate of 3.7%. In 2018, Vietnam was Hong Kong`s sixth-largest export destination, with 60% of re-exports to mainland China. With the reduction or elimination of TARIFFS from ASEAN countries, Hong Kong`s domestic products in the region are becoming more competitive. On November 12, 2017, the Association of Southeast Asian Nations (ASEAN) and China`s Hong Kong Special Administrative Region signed a free trade and investment pact aimed at strengthening economic cooperation between the two regions and boosting economic development. The two agreements, ASEAN-Hong Kong, china Free Trade Agreement (AHKFTA) and ASEAN-Hong Kong Investment Agreement (AHKIA), were signed at the 31st ASEAN Summit in Manila and will enter into force on 1 January 2019. The Association of Southeast Asian Nations (ASEAN)1 was Hong Kong`s second largest trading partner in merchandise trade in 2019 and fourth in services trade in 2018. Total merchandise trade between Hong Kong and ASEAN amounted to HK$1.018 billion in 2019 and total services trade between the two sides amounted to HK$137 billion in 2018. At the end of 2018, ASEAN ranked fourth among Hong Kong`s overseas direct investment destinations, with a stock of $480 billion. With a stock of HK$533 billion, it ranked sixth among Hong Kong`s sources of foreign direct investment.
Hong Kong has a Closed Economic Partnership Arrangement (CEPA) with China, which allows Hong Kong service providers to access a preferential market and benefit from duty-free treatment for products originating in Hong Kong. With CEPA, ASEAN-China FTA and AHKFTA, Hong Kong has the potential to facilitate and increase investment and trade across the region. Hong Kong`s importance as a company for trade between mainland China and Vietnam will continue to grow much faster with the entry into force of the free trade agreement. ASEAN merchandise exports to China via Hong Kong have grown by an average of 6.4% per year since 2012. Among the member states, Singapore, Thailand and Vietnam are Hong Kong`s main trading partners and account for 38.8%, 15.7% and 15.2% of Hong Kong`s total merchandise trade with the region, respectively. With improved access to Hong Kong`s trade network, its proximity to mainland China, and China`s Belt and Road Initiative, foreign and domestic companies should be prepared to take full advantage of the benefits of the free trade agreement. The AHKFTA covers 14 chapters covering broad areas of market access liberalization, trade facilitation, rules to promote confidence in trade, and cooperation to facilitate trade in goods and services in the region. This is ASEAN`s sixth free trade agreement with external partners with China, Korea, Japan, India and Australia-New Zealand. You can find the agreements here.
Investment Agreement Annex Agreement with Brunei Darussalam, Malaysia and Singapore Annex Agreement with Singapore The Free Trade Agreement (consisting of 14 chapters) and the Investment Agreement cover many areas of importance to Hong Kong and ASEAN. The main functions are summarized below. Hong Kong also has access to the Pearl River Metropolitan Area (PRD), an economic center in China, and regional cooperation will continue to increase with the signing of the Framework Agreement on Deepening Cooperation between Guangdong, Hong Kong and Macau for the Development of the Bay Area in July 2017. The focus is on improving infrastructure connectivity, improving market integration, developing innovation centers, developing modern industries and strengthening international cooperation. Since 2012, exports of goods originating from ASEAN to China via Hong Kong have grown by an average of 6.4% per year. In 2016, 12% of trade between ASEAN and mainland China passed through Hong Kong worth more than $54 billion. . . .