(22 July 2024 – Hong Kong) Free Trade Agreements (FTAs) are becoming a greater concern for CFOs and treasurers across the Asia Pacific (APAC) region as corporates re-jig their trade policy in response to a complex emerging tangle of tariffs and incentives.
The COVID-19 pandemic and geopolitical tensions have disrupted global supply chains and forced many companies to rethink their international networks. As this realignment continues, companies cannot ignore the geopolitical push for more resilient supply chains.
The World Trade Organisation (WTO) has catalogued over 350 active trade agreements globally in 2024. FTAs grease the wheels of commerce by simplifying processes and reducing frictions in international transactions – such as tariffs and even more punitive non-tariff barriers to trade.
“Digital platforms can integrate new FTA rules as well, verifying documentation of sources or labour practices. If supply chain processes are digitalised, technologies such as AI, Internet of Things (IoT) and blockchain can enable real-time tracking to trigger payments and smooth cashflows.”
“FTAs can be especially beneficial for small to medium-sized enterprises (SMEs) that play critical roles in cross-border supply chains. Businesses that are among the first and most agile in adapting to the new Asia Pacific trade landscape will be best placed for sustained growth and resilience in the competitive global marketplace” HSBC said in a statement.