This paper argues that the recent bilateral free trade initiatives of ASEAN members and, in particular, the ASEAN-China free trade agreement (ACFTA), are driven by ASEAN’s desire to maintain its export growth based on the regional production networks promoted by multinational corporations. The paper undertakes an analysis of ASEAN-China bilateral trade and the tariff preferences under the ACFTA to understand the actual prospects for Southeast Asian countries to expand their market access. It is concluded that without effective strategies for industrial upgradation and restructuring at the national levels, ASEAN’s attempts to obtain increased investment and export market access based on FTAs will fail to be effective.

August 29, 2008.