Emerging opportunities in Southeast Asia could be missed by businesses in the U.S. if the country continues to avoid trade agreements, according to U.S.-ASEAN Business Council Senior Vice President-Policy Marc Mealy.
Speaking at the National Fisheries Institute Global Seafood Market Conference, Mealy said Southeast Asia – especially ASEAN (Association of Southeast Asian Nations) countries, are increasingly becoming viable markets for exported seafood as the region's middle class continues to grow.
“There’s no question that these are some of the fastest-growing consumer markets in the Asia-Pacific region,” U.S.-ASEAN Business Council Senior Vice President-Policy Marc Mealy said. “Young populations, middle classes, people have incomes to spend money at restaurants and buying food … and food is very much a fundamental parts of culture.”
However, changing trade relationships within the region may make it difficult for the U.S. to tap into those markets, Mealy said. Supply chains are evolving in the region, and those between North America and Asia are also shifting, he said.
“The trade landscape in the Indo-Pacific region is also evolving,” Mealy said. “One of the things that we should probably take into account going forward is the introduction of the new world's largest free trade agreement, called the Regional Comprehensive Economic Partnership, that basically went live on 1 January.”
The partnership is a free trade agreement between the Asia-Pacific nations of Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. The trade agreement encompasses 30 percent of the world’s population and 30 percent of global GDP, making it the globe's biggest trading bloc.
“That will influence how supply chains within the Asia-Pacific region begin to evolve, because not only are duties and tariffs for trade within Asia going to be reduced … But it may also create some commercial shifts relative to trade from within the region to countries and businesses outside the region,” Mealy said.
As the relationship between countries within the partnership and outside it continue to evolve, the U.S. has been on the sidelines, he said.
“The United States is not participating in any of them, and as a result of our not participating in them, for U.S.-based producers of goods and services and importers, we are going to be finding ourselves at a competitive disadvantage relative to other producers, other exporters, and potentially importers,” Mealy said.
At the same time, U.S. neighbors Mexico and Canada have capitalized on free trade agreements and are now at a competitive advantage, according to Mealy.
“There are exporters and importers in Mexico and in Canada who now have pretty much duty-free access to move goods between those countries and Vietnam, for example,” Mealy said. “That’s an advantage that, for you all who are based in America, you don’t have at the moment.”
Photo courtesy of Kirill Neiezhmakov/Shutterstock
