China’s institutional opening-up can establish a resilient trade structure with ASEAN amid global economic fragmentation

Against the backdrop of rising global protectionism and worsening economic fragmentation, the world is grappling with a critical challenge: trade restriction measures have surged in recent years. This trend of “decoupling and breaking chains” fragments global industry and supply chains, undermining the efficiency of global resource allocation. Amid this turmoil, China is forging a new cooperation model — one rooted in institutional opening-up and deep integration with the Association of Southeast Asian Nations. This model, distinct from traditional geopolitical rivalry, offers a more resilient and inclusive alternative that strengthens regional interdependence and aligns with high-standard international rules, providing a practical solution to global fragmentation.

Institutional opening-up stands as the core pillar of China’s new cooperation model, driving high-standard integration of economic and trade systems. Since the establishment of the Shanghai Pilot Free Trade Zone in 2013, China has used pilot zones as testing grounds to align with international high-standard rules, accumulating experience in intellectual property protection, competition policy and green transformation. A landmark achievement is the upgrading of the China-ASEAN Free Trade Area to its 3.0 version in October 2025, which expands cooperation beyond traditional trade to emerging fields such as the digital economy, green economy and supply chain connectivity — directly reflecting alignment with high-standard frameworks such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Digital Economy Partnership Agreement.

China’s 2021 applications to join the CPTPP and DEPA further demonstrate its commitment to institutional opening-up: The CPTPP’s focus on “behind-the-border” measures (such as labor and environmental standards) and DEPA’s emphasis on digital trade rules have guided China’s reform efforts, ensuring its opening-up is not just about market access but rule convergence. By the end of 2025, China had signed 23 free trade agreements with 30 countries and regions, covering 43 percent of its total foreign trade, forming a rule-aligned regional economic network that counters fragmentation.

ASEAN serves as the critical test case and fulcrum of this new model, with deep integration fostering interdependence and resilience. ASEAN has been China’s largest trading partner for six consecutive years, with bilateral trade reaching 6.82 trillion yuan ($977.4 billion) in the first 11 months of 2025, an 8.5 percent year-on-year increase. Agricultural trade alone was $51.3 billion in the first 10 months of 2025, growing by 8.9 percent. China’s imports of dried and fresh fruits and vegetables from ASEAN exceed $10 billion, accounting for more than two-thirds of its global imports.

Beyond the trade volume, supply chain integration has deepened: Intermediate product trade between China and the Regional Comprehensive Economic Partnership region (centered on ASEAN) accounts for over 60 percent of total trade, reaching $4.4 trillion in 2022. China’s investment in ASEAN — $15.5 billion in 2023, accounting for 12 percent of its total outbound investment that year — has spawned over 6,500 Chinese enterprises in the region, with key projects such as the China-Malaysia “Two Countries, Twin Parks” and China-Indonesia Regional Comprehensive Economic Corridor strengthening industry chain links.

Infrastructure connectivity projects such as the China-Laos Railway and Jakarta-Bandung High-Speed Railway have unleashed “golden channel” effects, reducing logistics costs and facilitating the free flow of goods and personnel. China’s exports of new energy vehicles (26 percent of ASEAN’s imports) and mechanical and electrical products have upgraded ASEAN’s manufacturing value chain, while China’s imports of energy and mineral products (up 31.2 percent from 2021) have boosted resource-rich ASEAN economies, creating a complementary, win-win dynamic.

China’s new cooperation model offers a powerful response to global fragmentation and a blueprint for inclusive globalization. By prioritizing institutional opening-up, China is aligning with international high-standard rules rather than retreating into bloc politics, while deep ASEAN integration builds a resilient regional economic community that resists decoupling pressures.

The effectiveness of this model is reflected in China’s trade resilience. In the first half of 2025, its total goods trade reached 21.79 trillion yuan (up 2.9 percent year-on-year), with exports rising 7.2 percent to 13 trillion yuan. More importantly, the model promotes inclusive growth: China grants zero-tariff treatment to all African countries with which it has diplomatic relations, and ASEAN’s integration into global value chains has created jobs and industrialization opportunities for its members.

As China advances high-level opening-up under the 15th Five-Year Plan (2026-30), this model will continue to guide its efforts to revitalize the multilateral trading system — through initiatives such as the World Trade Organization Investment Facilitation for Development Agreement — and shape a more fair and reasonable global economic governance order. In an era of division, China’s blend of institutional opening-up and regional integration proves that cooperation, not confrontation, is the path to shared prosperity.

China’s new model of opening-up provides three practical paths for advancing the Global Development Initiative.

First, it helps the industrialization process of developing countries through capacity cooperation. China’s capacity cooperation with ASEAN countries has transformed its own advantageous production capacity into local advantageous industries. For instance, cooperation in new energy and mechanical equipment has enhanced the manufacturing level of ASEAN countries and promoted their industrialization and digital transformation.

Second, it breaks through development bottlenecks through connectivity construction. Projects such as the China-Laos Railway and the Jakarta-Bandung High-Speed Railway have improved regional transportation conditions, reduced logistics costs, and promoted trade and personnel exchanges within the region, creating conditions for developing countries to integrate into the global value chain. The construction of the new western land-sea corridor has further facilitated the comprehensive advancement of RCEP economic and trade cooperation, injecting new impetus into win-win cooperation among the Belt and Road countries.

Third, it enhances development quality through rule alignment. The alignment of rules in the CAFTA 3.0 in areas such as the digital and green economy helps ASEAN countries adapt to international high-standard rules, enhancing industrial competitiveness and achieving high-quality growth.

In conclusion, China’s model of institutional opening-up and deep integration with ASEAN represents a constructive and forward-looking approach to global economic governance in an era of uncertainty. By anchoring cooperation in high-standard rules, mutual benefit and shared development, it not only strengthens regional resilience but also offers a replicable pathway for inclusive globalization. As this partnership continues to deepen, it will serve as a stabilizing force in world trade and a testament to the enduring value of openness, dialogue and common progress.

Li Yang is a professor at the China Institute for World Trade Organization Studies at the University of International Business and Economics. Tang Ke is a lecturer at the School of International Economics and Trade at Henan University of Economics and Law.

The authors contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn.