The ASEAN agreement offers a way out by allowing companies to shift production to other low-cost regions of Asia, taking advantage of these lower costs, and still being able to serve the Chinese market through duty-free imports allowed by the free trade agreement. China has developed a strategic position when it comes to concluding free trade agreements – the policy of allowing tariff and tax reductions on certain goods and services is one of the most important cornerstones that have declared the country the center of global production in recent years. Undoubtedly, the signing of the China-ASEAN Free Trade Agreement is and will have a major impact on the development of China and Asia in global purchases and associated foreign investment. Chinese President Xi Jinping (3. L.) meets his Singaporean counterpart Tony Tan Keng Yam (R4) in Singapore on 6 November 2015. [Xinhua] Singapore, with its wealth of financial and other services, also has a free trade agreement with China. Signed in 2009, this agreement focuses on the service industry in addition to the tax benefits of individuals. Singapore intends to increase its population by an additional 2 million people, and many of them are expected to be wealthy mainland Chinese nationals. Benefits for businesses include reduced withholding taxes on a variety of services, including eligible royalties. This, coupled with Singapore`s low corporate and personal tax rates, is one of the reasons why Singapore is becoming a regional hub for investment in China and Asia, receiving more and more Chinese foreign investment going in the opposite direction – to Singapore and for reinvestment across Asia. Since foreign investors are automatically considered Singaporean companies when setting up a subsidiary, they can also access Singapore`s impressive international tax treaties, including many other free trade agreements and more than 80 bilateral double taxation treaties. Trade between China and South Korea rose from $6.4 billion in 1992, when the two countries established diplomatic relations, to $235.4 billion in 2014.
China has been South Korea`s No. 1 trading partner since 2004. South Korea has been China`s fourth largest trading partner since the same year An interactive list of bilateral and multilateral free trade instruments is available on the TREND Analytics website. [59] Introduction to tax treaties across Asia In this issue of Asia Briefing Magazine, we look at the different types of trade and tax treaties that exist between Asian nations. .
