EU’s 2023 trade data released by Eurostat showed that overall trade with ASEAN declined 7.3% year-on-year, from 272 billion euros to 252 billion euros. EU’s imports from ASEAN declined 12.5% compared to 2022, while EU exports to ASEAN rose slightly by 2.7%. EU’s trade balance with ASEAN remains negative (-63 billion euros), although the deficit was narrower in 2023 than in 2022. This means that the EU continues to import more from ASEAN than it exports to ASEAN.
Nevertheless, the bilateral trade remains healthy, with overall trade between EU and ASEAN remaining on an upward trajectory, notwithstanding the drop in 2020 due to Covid-19 pandemic, and the spike in 2022 of EU’s imports from ASEAN due to trade disruptions caused by the war in Ukraine.
Breaking down EU trade with individual ASEAN Member States, the three largest trading partners are Vietnam, Singapore, and Malaysia, followed closely by Thailand, Indonesia, and Philippines. Vietnam has taken over Singapore as the EU’s largest ASEAN trade partner for goods since the entry into force of the EU-Vietnam Free Trade Agreement (EV-FTA) in 2020, with a remarkable increase in Vietnamese exports to the EU market. (However, when taking into account both goods and services, Singapore remains the largest trading partner for the EU) [1].
In ASEAN, the EU imports the most from Vietnam (worth 47 billion euros, or 30% of all ASEAN imports), followed by Malaysia (29 billion euros), and Thailand (25 billion euros). EU exports the most to Singapore (32 billion euros, or 34% of all exports to ASEAN), followed by Malaysia (15 billion euros), and Thailand (15 billion euros).
The EU continues to draw a trade deficit with most ASEAN member states, with the exception of Singapore and Brunei. Overall trade balance with ASEAN narrowed by 18% to -63 billion euros, down from 88 billion euros in 2022. This was mainly due to the EU importing less from ASEAN in 2023 than in 2022, which may have spiked due to the energy crisis in Europe.
What is the EU importing from ASEAN?
Based on available Eurostat data for the Eurozone, machinery and transport equipment makes up almost half of the total goods imported by the EU. Manufactured goods make up another quarter of total imported goods followed by chemicals and related products; raw materials; and food, drinks and tobacco. Machinery and transport equipment are the main exports from Vietnam, Malaysia and Thailand, while manufactured goods are exported mainly by Vietnam and Indonesia. Most of the raw materials from ASEAN come from Indonesia and Malaysia, while the EU imports chemicals and related products mainly from Singapore. Food, drinks and tobacco comes mainly from Vietnam, Thailand, and Indonesia.
What is ASEAN importing from the EU?
Most of the EU’s exports to ASEAN are also machinery and transport equipment to Singapore, Indonesia, Malaysia, Thailand, and Vietnam, although it also exports a significant amount of chemical and related products, as well as manufactured goods to Singapore and Malaysia.
Conclusion
The new trade data demonstrates the positive impact on bilateral trade by the existing FTAs with Singapore and Vietnam, and with ongoing negotiations with Indonesia, Thailand, and Philippines, ASEANcham-EU expects that bilateral trade has the potential for exponential growth.
[1] EU trade relations with Singapore (europa.eu)