Businesses in Southeast Asia are eyeing more opportunities in the Chinese market following the announcement of a significant upgrade to the China-ASEAN Free Trade Area.

At the 27th China-ASEAN Summit in Laos' capital Vientiane on Thursday, the leaders of China and the Association of Southeast Asian Nations announced the substantial conclusion of Version 3.0 China-ASEAN Free Trade Area upgrade negotiations, marking a milestone in their economic relationship.

"China is the biggest trading partner for ASEAN already, so … this new version of the agreement just raises opportunities," said Nazir Razak, chairman and founding partner of private equity firm Ikhlas Capital in Singapore.

Nazir, who is also chairman of the ASEAN Business Advisory Council of Malaysia, told China Daily that the council will work to educate regional companies on the capabilities of the agreement and encourage greater trade with China.

The China-ASEAN Free Trade Area was established in 2010, with an upgraded Version 2.0 launched in 2019. Negotiations for Version 3.0 began in November 2022, aiming to address emerging areas such as the digital economy, green economy and supply chain connectivity.

China and ASEAN have confirmed they will promote the signing of the 3.0 upgrade protocol next year, the Chinese Ministry of Commerce said.

China has been ASEAN's largest trading partner for 15 consecutive years, while ASEAN has held the position of China's top trading partner for the past four years. Last year, their bilateral trade volume reached $911.7 billion, the ministry said.

Nguyen Thanh Hung, chairman of the Vietnamese conglomerate Sovico Group, said the upgrade of the China-ASEAN Free Trade Area "will strongly support enterprises in trade and investment and bring more benefits to businesses in ASEAN countries and China to grow together".

The upgraded agreement will enable ASEAN companies to further expand their business ties with China, Hung said.

Seeing the bright prospects, Hung, who is also vice-chairman of Vietjet Air, said the airline is planning to increase its routes connecting to Chinese cities for both passenger and cargo transport.

Currently, Vietjet operates 84 routes linking 46 Chinese cities from Vietnam, and 46 routes from Thailand to 30 Chinese cities. Over the past 10 years, the airline has transported 12 million Chinese passengers to Vietnam, he added.

"We even plan (to establish) some joint ventures in China and in Vietnam," said Hung, adding his company also works closely with its Chinese counterparts in e-commerce, infrastructure and logistics.

Tee Chee Seng, vice-president of the Vientiane Logistics Park, said the conclusion of the negotiations on the China-ASEAN FTA 3.0 is a good start for Laos, as the country can play a more significant role in facilitating regional trade and logistics under the upgraded agreement.

Laos stands to benefit as the only ASEAN country connected to China by rail, Tee said, citing the China-Laos Railway that began operations in December 2021.

The 1,035-kilometer railway connects Kunming in China's Yunnan province with the Laotian capital, Vientiane. In the first eight months of this year, it handled more than 3.58 million metric tons of imports and exports, a 22.8 percent increase year-on-year.

As the FTA upgrade will encourage more people to look for opportunities in both China and ASEAN, Tee said it will usher in a new era for the Vientiane Logistics Park and for Laos in terms of trade and investment.

Vilakorn Inthavong, manager of the marketing department at Alo Technology Group in Laos, said he hopes the upgraded FTA can further ease the process for ASEAN products to enter the Chinese market, especially by shortening the approval time for new products — a critical factor for small and medium-sized companies.

Vilakorn said he welcomes more Chinese investment in renewable energy to develop Laos' supply chain. "Our group is also working with a company in China's Yunnan province to develop a supply chain for electric vehicles in Laos."

Noting that his group operates an e-commerce marketplace for made-in-Laos products and exports Lao agricultural products to China, Vilakorn said he hopes the FTA upgrade will promote greater China-ASEAN cooperation in digitalization to stimulate regional trade.