OMM Newsroom
German Chancellor Friedrich Merz said during a visit to Singapore on October 27 that the European Union was seeking to deepen trade ties with Asia. Merz said rising global trade barriers posed a threat to international trade, AnewZ reports.
Merz called for closer cooperation with Southeast Asian economies and members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which includes 12 countries. He defended open markets and predictable trade rules in response to growing protectionism.
A study published in July by the World Trade Organization (WTO) and the International Monetary Fund (IMF) found that global trade policy activity in the first five months of 2026 was almost twice as high as in the same period of 2024. The increase was driven mainly by restrictive measures.
Why is Europe strengthening economic ties with Asia?
Strengthening economic ties with Asia could help Europe diversify its export markets and investment partnerships amid uncertainty over US tariffs and Chinese trade restrictions.
“In an international environment once again shaped by competition among major powers, we must defend our interests,” Merz said.
Speaking alongside Singaporean Prime Minister Lawrence Wong, Merz said the European Union, with about 450 million consumers, wanted to strengthen partnerships based on open competition, reliability and rules-based trade.
“This is a deliberate response to what we are seeing today ... We want to do things differently and show that there is a better way,” Merz said.
He also called for stronger ties with CPTPP members. The agreement includes Japan, the United Kingdom, Canada, Australia, Mexico, Singapore and Malaysia. The United States and China are not members.
Trade between the European Union and ASEAN
According to the European Commission, trade in goods between the European Union and the Association of Southeast Asian Nations (ASEAN) reached 274.9 billion euros (about $319 billion) in 2025, making ASEAN the EU’s third-largest trading partner outside Europe.
The European Union’s investment stock in ASEAN stood at 363.4 billion euros (about $422 billion) in 2024.
Singapore plays an important role in these ties. EU-Singapore trade in goods reached 47.8 billion euros (about $55.4 billion) in 2025. The EU-Singapore Digital Trade Agreement, which entered into force in February 2026, set rules to simplify digital transactions and cross-border trade.
These figures highlight Southeast Asia’s growing importance to European businesses, even in the absence of a comprehensive regional free trade agreement.
Regional agreement and other areas of cooperation
Singaporean Prime Minister Lawrence Wong said his country would seek progress on an ASEAN-EU free trade agreement during its rotational chairmanship of ASEAN in 2027.
“We understand that this will be difficult. The issue is complex, but we are also somewhat confident about making progress,” Wong said.
The European Union has bilateral free trade agreements with several Southeast Asian countries, while negotiations with others in the region are ongoing. Merz called on the European Commission to coordinate trade ties with Singapore, Malaysia, Indonesia and India more effectively, saying this would create additional opportunities for European businesses.
Reaching a region-wide agreement could prove difficult because economies differ in their rules, industrial priorities and levels of development.
The European Union and ASEAN are also considering closer cooperation in energy, technology and security. Merz said the EU was ready to support ASEAN’s initiative to connect national electricity grids, a project aimed at strengthening energy links across Southeast Asia.
The two leaders also discussed expanding cooperation in artificial intelligence, sustainable energy, defense and security.
Wong confirmed Singapore’s interest in investing in Germany and the European market as a whole. He said investors, including sovereign wealth funds, remained confident in Europe’s long-term economic prospects.
For the European Union, deepening ties with Asia offers a chance to expand export markets, attract investment and reduce the impact of disruptions to global trade. Whether these plans lead to concrete agreements will depend on the parties’ ability to overcome their economic differences.
