Overview of AHKFTA Agenda
Hong Kong applies a 0% tariff on virtually all goods. As a result, the ASEAN-Hong Kong Free Trade Agreement (AHKFTA) holds limited tangible benefits in terms of tariff concessions for ASEAN member states.
The core value of AHKFTA lies not in tariff reductions but in leveraging Hong Kong’s strategic position as a logistics and financial transshipment hub connecting China and global markets. ASEAN countries benefit from Hong Kong’s geographic position and financial infrastructure, which enhances their access to global markets.
Service Market Liberalization and Investment Principles
Under AHKFTA, Vietnam has committed to opening its service market at a level equivalent to its World Trade Organization (WTO) commitments. This aligns with existing conditions under the WTO while strengthening economic cooperation with Hong Kong through the AHKFTA framework.
AHKFTA reiterates principles similar to those of ASEAN’s other FTAs in safeguarding foreign investment. A key commitment within AHKFTA is the principle of Fair and Equitable Treatment (FET) for foreign investors, which is vital for creating a stable investment environment and ensuring legal protection for foreign investors in Hong Kong and ASEAN.
Strategic Focus Areas (2024-2025)
Adapt current sections to emphasize AHKFTA’s provisions that encourage e-commerce, cross-border data flows, and data protection. Highlight potential collaboration in fintech and digital trade innovations.
Emphasize AHKFTA’s potential to facilitate green investments, as Hong Kong has shown commitment to supporting low-carbon and energy-efficient technologies.
Focus on AHKFTA’s support for SMEs through market access and participation in regional supply chains, with specific initiatives to strengthen SMEs in digitalization and international market entry.