ATIGA Review and Industrial Strategy in an Age of Geopolitical Risk

ASEAN’s rules of origin require a fundamental reassessment to remain effective amid rising geopolitical risks and evolving global trade dynamics, according to a recent analysis published by The Diplomat on April 21, 2026.

The article, titled “ASEAN’s Rules of Origin Need a Rethink,” argues that the current framework under the ASEAN Trade in Goods Agreement (ATIGA) is increasingly misaligned with the realities of fragmented supply chains, strategic competition between major powers, and the growing use of trade measures as tools of geopolitical leverage.

ATIGA, which came into force in 2010, was designed to deepen economic integration among ASEAN member states by eliminating tariffs on originating goods and establishing common rules to determine product eligibility for preferential treatment. However, the Diplomat piece contends that the agreement’s rules of origin — the criteria used to define whether a product qualifies as “ASEAN-made” — have not kept pace with shifts in global manufacturing and trade policy.

Geopolitical Pressures Exposing Framework Gaps

The analysis highlights how intensifying geopolitical tensions, particularly between the United States and China, have led to a proliferation of trade restrictions, export controls, and localization mandates that complicate compliance with traditional origin rules. These developments have created incentives for firms to reconfigure supply chains in ways that may exploit loopholes or strain the existing ATIGA framework.

Need for Industrial Strategy Integration

The Diplomat’s article emphasizes that any update to ATIGA’s rules of origin must be paired with a broader industrial strategy. It notes that ASEAN Economic Ministers, in their March 16, 2022, meeting, had already signaled the need to upgrade ATIGA in response to the pandemic and rising geopolitical crises — a point reiterated in a 2022 op-ed by ASEAN’s Deputy Secretary-General Satvinder Singh.

The article suggests that modernizing the rules of origin should go beyond technical adjustments to include measures that support regional value chain development, enhance transparency, and align with sustainability and resilience goals. Without such integration, the agreement risks becoming irrelevant to businesses navigating an increasingly complex trade environment.

ATIGA Review as a Strategic Opportunity

The piece frames the ongoing review of ATIGA as a critical opportunity for ASEAN to strengthen its collective economic position. By reforming rules of origin to reflect current production realities — such as increased cross-border manufacturing within ASEAN and greater reliance on digital trade — the bloc could improve its attractiveness as a destination for investment and deepen intra-regional cooperation.

The Diplomat concludes that failure to adapt the rules of origin could undermine ASEAN’s centrality in global trade networks, while a thoughtful update — grounded in both economic realism and strategic foresight — could help the region turn geopolitical volatility into a catalyst for more resilient and inclusive growth.