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Today, the four largest Asian national economies\u2014China, Japan, India, and South Korea\u2014already account for approximately one-fourth of global GDP. So does the United States, thus currently being the dominant global economic power. However, the Asia-Pacific region is expected to have high economic growth in the future, while the growth rates in industrial countries are forecast to stagnate or decline. For this reason, the EU\u2019s Trade and Investment Strategy published in 2015 also calls for the strengthening of the EU\u2019s \u201cpresence in the Asia-Pacific region\u201d.<\/p>\n
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The rising protectionism worldwide and, more specifically, the political antics of U.S. President Donald Trump, have given strong momentum to what some observers have already called \u201cEurope\u2019s Asia Pivot\u201d. Furthermore, Brexit means that the European Union is facing an at least partial economic disintegration. Against this backdrop it is all the more important to find new partners and to strengthen or reorient relations with old partners, Asia being one of them.<\/p>\n
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The Asia-Europe Meeting (ASEM) with currently 53 members already gives European-Asian relations an institution that would lend itself to this purpose, since the promotion of economic cooperation is an important pillar in the ASEM process. In the future, Asia and Europe could make greater use of this platform in order to further expand the framework conditions for European-Asian trade and investment relations.<\/p>\n
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<\/p>\n China as Main Driver: European-Asian Trade Relations<\/strong><\/p>\n <\/p>\n The 18 Asian members of the ASEM already take on major importance in so-called extra-EU trade, that is, exchange of goods between the EU and the rest of the world: In 2016, they stood for approximately 31 percent of extra-EU trade. China as the region\u2019s economic heavyweight accounts for half of this (14.7 percent). Nevertheless, the United States continues to be the EU\u2019s most important extra-EU trading partner. In extra-EU imports, however, China takes first place over the United States.<\/p>\n <\/p>\n Among the top 10 extra-EU trading partners in 2016, there were three other ASEM members: Japan, South Korea, and India. It was only trade with China, however, that grew at a truly dynamic rate. Japan\u2019s share has fallen by almost half since 2002. South Korea\u2019s and India\u2019s shares have stagnated at around 2.5 and percent, respectively. In contrast, Malaysia, Indonesia, and Vietnam, which are regularly cited as future economic centers in the region, have barely exceeded 1 percent in the past 15 years.<\/p>\n <\/p>\n <\/p>\n Free trade agreements (FTAs) are one key to releasing the potential that the trade relations between the EU and its most significant ASEM trading partners could offer. At the present time, the EU is negotiating bilateral FTAs with a number of Asian countries. Negotiations on bilateral FTAs have already been concluded with Singapore and Vietnam, although the agreements have not yet entered into force. Other negotiations, such as with Japan, have gained new momentum with U.S. President Donald Trump\u2019s accession to office. As of to date, however, South Korea is the only Asian member of the ASEM that has an FTA with the EU that has entered into force.<\/p>\n <\/p>\n <\/p>\n Room for Growth: European-Asian Investment Relations<\/strong><\/p>\n <\/p>\n The transatlantic relations are dominant in foreign direct investment (FDI) between the EU and non-EU member states (extra-EU FDI), too: the United States accounts for 37.1 percent of the EU\u2019s outward FDI stock and even 41.4 percent of the EU\u2019s inward FDI stock. In contrast to extra-EU trade, the Asian members of the ASEM play a rather subordinate role here: their share accounts for 9.5 percent and 5.3 percent, respectively. This shows that the EU has invested significantly more in these countries than vice versa. At least part of the EU\u2019s trade deficit with the Asian members of the ASEM is attributable to this: European companies have set up subsidiaries in Asian countries through which they import cost-efficient intermediate and final goods into the EU and from there\u2014possibly processed further\u2014export to other regions of the world. It is therefore not surprising that China, as the \u201cfactory of the world,\u201d currently is the EU\u2019s most important FDI location in Asia.<\/p>\n <\/p>\n![\"BST_GED_ASEM_E_Tab1\"](\"https:\/\/bst-europe.eu\/wp-content\/uploads\/sites\/24\/2017\/09\/BST_GED_ASEM_E_Tab1.jpg\")
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