Brunei Darussalam’s Foreign Trade Policy Objectives
To promote an outward looking and conducive environment for trade and investment in Brunei Darussalam.
Explore and identify market opportunities for Brunei Darussalam’s business people.
To increase economic activities and contribute significantly to economic diversification (i.e. away from oil and gas).
Maximize benefits from involvement in international and regional fore.
Main Pillars of Brunei Darussalam’s Foreign Trade Policy
The World Trade Organization (WTO) provides the stable framework of multilateral trade rules that ensure the freer flow of goods and services.
Participation in regional economic forums is based on the concept of “open regionalism”.
Free Trade Agreements (FTAs) with key trading partners can help to facilitate trade liberalization and strengthen trade links.
Guiding Principles of Brunei Darussalam’s Foreign Trade Policy
Pursuit of free and open trade within the context of multilateral trade rules.
Support for an open, rules-based and non-discriminatory multilateral trading system.
Recognition of “open regionalism” as a building block towards multilateral trade liberalization.
Brunei Darussalam's FTA Policy
Brunei Darussalam views Free Trade Agreements (FTAs) as a vital part of its foreign trade policy to maximise the potentials of free and open trade for its people in an ever-globalising world. With a relatively free and open trading regime, as well as a small but highly educated workforce, Brunei Darussalam sees engagement on FTAs as an important step in ensuring that its people, goods, services and investments have continued access to wider markets around the world.
Brunei Darussalam, which is largely seen in the international community as a producer of oil and gas, is currently undertaking a number of projects in a bid to further diversify its economy. In this regard, the Government of Brunei Darussalam strongly believes that active engagement of FTAs with a number of key strategic partners will open up markets for Brunei’s exports and services as well as help facilitate the flow of foreign direct investment into Brunei Darussalam.
Overview of Brunei FTAs
Brunei Darussalam has been actively engaged in FTAs through its membership in ASEAN as well as on a bilateral basis.
To date, Brunei Darussalam, through ASEAN, has concluded FTAs with Australia & New Zealand,China, India, Japan and South Korea.
Bilaterally, Brunei Darussalam has concluded an Economic Partnership Agreement with Japan (the Brunei-Japan Economic Partnership Agreement or “BJEPA”) and a plurilateral agreement with Chile, New Zealand and Singapore (the Trans Pacific Strategic Economic Partnership or more commonly referred to as the “P4”)
The BJEPA is Brunei Darussalam’s first bilateral free trade agreement. The Agreement was signed by the leaders of both Brunei Darussalam and Japan on 18 June 2007, and entered into force on 31 July 2008. The Agreement is hoped to enhance Brunei Darussalam’s investment climate and encourage foreign direct investments (FDI) through greater predictability and transparency. Market access between Brunei Darussalam and Japan will also be improved in terms of goods (through the reduction of import duties) and services. Marking the long-standing relationship between both countries, the Agreement also has chapters on Energy, Improvement of Business Environment and Cooperation which will help further strengthen bilateral ties to a higher level of partnership.
Brunei signed the P4 on 2 August 2005 and deposited its Instrument of Provisional Application to New Zealand as the depository of the Agreement on 12 June 2006. The Agreement came into force for Brunei Darussalam on 12 July 2006, and will bring about strategic benefits for all four partners, Brunei Darussalam, Chile, New Zealand and Singapore, and in effect build a bridge between Latin America, the Pacific and Asia. It will encourage Brunei, Chile, Singapore and New Zealand to pool their expertise, ideas, technology and resources to improve their competitiveness on the global market. The Agreement will also help advance shared objectives in APEC and the WTO.
The P4 also has side agreements, namely the Environment Cooperation Agreement and Labour Cooperation Memorandum of Understanding, to reflect a shared desire to encourage and promote sound labour and environment practices. These agreements establish mechanisms for on-going cooperation and dialogue on labour and environment issues.
Brunei Darussalam, along with P4 partners, are currently negotiating with Australia, Malaysia, Peru, the United States and Viet Nam, to expand the P4 and upon its conclusion, it will be referred to as the Trans-Pacific Partnership (TPP). The expansion of the P4 to TPP will produce a high-quality Agreement that addresses new and emerging trade issues not yet adequately dealt with in existing trade agreements.