Mandelson, currently on a four day tour of Hong Kong, Vietnam, Thailand and Singapore, told a press conference in Ha Long, Vietnam yesterday: "I am pleased to add my support to our agreement this morning to undertake a high-level feasibility study for a FTA."
Already the EU and ASEAN share significant investment and trade ties through the 2003 Trans-Regional EU-ASEAN Trade Initiative (TREATI) and the EU Generalised System of Preferences (GSP).
The implementation of a FTA, however, would be comparatively more important to the region's food producers, eventually leading to the abolition of trade duties on a raft of products - seafood and other agricultural commodities, for instance.
"We agreed to deepen and intensify work together to boost ASEAN-EU economic cooperation," Mandelson added.
The EU confirmed that feasibility studies, to be compiled by a joint team of EU and ASEAN officials, would be submitted by the close of 2005.
ASEAN countries, which are expected to post average economic growth of around 6 per cent this year, include Vietnam, Thailand, Singapore, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar and the Philippines and the association is currently negotiating additional FTAs with Japan, South Korea, India, Australia, New Zealand and China.
"Over the last twenty years the European Union's relations with Asia have changed beyond recognition. Europe's huge economic investment in the region is still not properly matched by an equivalent political commitment," Mandelson said prior to his departure.
"Europe has to take its political and strategic relationship with Asia to a new level, and ever closer trade links are a key part of this. There is a tendency in Europe to see a booming Asia simply as a commercial competitor, but it is also a huge new market for European goods and investment. Europe and Asia do not have to choose between economic competition and strategic partnership," he added.
The EU is ASEAN's second largest trading partner and third largest export market, accounting for more than 15 per cent of ASEAN exports, in addition to being the region's largest foreign investor. Since 1990, EU imports from ASEAN members have increased by an estimated 10 per cent per annum.
Earlier this month, New Zealand and Thailand signed a FTA, which will see import tariffs abolished on a raft of products over the next fifteen years, including cow's milk and butter and carrots.