By Evan Liu
Singapore container port, August 22, 2009. File photo. William Cho / Wikimedia Commons, CC BY-SA 2.0. Unmodified.
Tariffs have already been eliminated on nearly 99% of product lines covered by ASEAN’s goods agreement. Yet doing business across Southeast Asia is still not always easy. Now, ASEAN wants to move beyond tariffs and tackle customs procedures, rules of origin and the barriers preventing the region from functioning more like a single market.
ASEAN is accelerating its internal economic integration. On September 22, Singapore Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong said ASEAN members were working to bring the upgraded ASEAN Trade in Goods Agreement (ATIGA) into force by the end of 2026, earlier than the original target of mid-2027.
The development raises a simple but important question: if tariffs have already disappeared on almost all covered products, why is cross-border trade still complicated?
Tariffs Are No Longer the Biggest Problem
ATIGA is one of the foundations of free trade within Southeast Asia. ASEAN says tariffs had been eliminated on approximately 98.86% of product lines by 2025. Intra-ASEAN trade also grew from about US$503 billion in 2010 to roughly US$823 billion in 2024.
But zero tariffs do not automatically mean frictionless trade.
Businesses still face different customs procedures, documentation requirements, rules of origin and other non-tariff measures. Rules of origin determine whether a product qualifies as originating within the trading bloc and can receive preferential treatment.
Large multinational companies may have the resources to navigate these systems, but for smaller firms, administrative complexity can itself become a barrier to entering another ASEAN market.
The upgraded ATIGA is therefore less about cutting tariffs and more about making regional trade simpler, faster and more predictable.
ASEAN Wants to Look More Like One Market
This is the larger challenge facing ASEAN economic integration. The region has more than 600 million people, but its member states still operate under different regulations, customs systems and industrial policies. A company trying to sell across Vietnam, Thailand, Malaysia and the Philippines is not entering one seamless market.
The upgraded ATIGA aims to reduce some of those internal frictions through simpler trade rules, improved customs procedures and stronger supply-chain connectivity.
If it succeeds, ASEAN’s appeal to businesses could begin to change. Instead of being viewed simply as a collection of fast-growing economies, it could increasingly function as a more connected regional market of more than 600 million consumers.
That distinction matters when companies decide where to place factories, supply chains and regional headquarters.
The World Is Moving Into ASEAN — But ASEAN Must Integrate Itself
The timing is important. China, the United States, the European Union and Japan all have significant trade and investment interests in Southeast Asia. The Regional Comprehensive Economic Partnership (RCEP) also connects participating ASEAN economies with China, Japan, South Korea, Australia and New Zealand through a much larger trade framework.
In a companion article, we look at how Europe is building deeper economic ties with Southeast Asia through agreements and negotiations with countries including Singapore, Vietnam and the Philippines.
But as outside powers compete for greater access to ASEAN, another question becomes more important: is ASEAN itself ready?
If goods still face complicated procedures and different rules when moving between member states, the idea of an ASEAN single market will remain incomplete. That is why the upgraded ATIGA matters.
Its success will not be measured simply by how many more tariffs disappear. It will be measured by whether ASEAN can tackle the harder barriers that remain after tariffs have already fallen close to zero.
The next stage of ASEAN integration is about making its national markets work more like one. If ASEAN can achieve that, its greatest economic advantage may not simply be attracting supply chains moving between China, the United States and Europe. It may be turning Southeast Asia itself into a more integrated — and more influential — economic market.
About This Article
This article draws on official ASEAN information, Channel NewsAsia reporting and public trade data. The target of early entry into force remains subject to member states’ domestic procedures. Information and analysis reflect material available in September 2026.
By Evan Liu. Republished from Asia Horizon Review on Medium, with editorial clarification and replacement photography for the AHR edition.
Sources checked by AHR: ASEAN: ATIGA overview; ASEAN for Business, 2026; CNA, September 22.