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Free trade pact with ASEAN in sight
By Dai Yan (China Daily)
Updated: 2004-10-21 22:34

The foundations of the world's largest free trade area may be laid next month.

China and members of the Association of Southeast Asian Nations (ASEAN) may ink a free trade pact for goods in November, said a senior trade official.

"China and ASEAN members are expected to sign deals on goods trade and a dispute resolution mechanism," said An Min, Chinese vice-minister of commerce.

China and leaders of ASEAN countries are scheduled to meet in Vientiane, capital of Laos, in November.

Both sides agreed in principle on the two items under the free trade pact when economic and trade ministers met in Jakarta, Indonesia on September 4, An said.

China and ASEAN members have set up three working groups governing rules of origin, trade of goods and trade of services.

An said China and ASEAN members may begin to set up the free trade area next year as scheduled.

By 2010, it could become the world's largest FTA, and include 1.7 billion consumers with a combined gross domestic product of US$2 trillion.

An said the recognition of China's market economy status by all ASEAN members cleared the way to reach the deal on trade of goods.

ASEAN member countries recognized China's market economy status on September 4 after the ministerial trade meeting.

An believed the China-ASEAN FTA will offer great prospects as the early harvest programme has proved.

The programme was launched January 1 this year and offered preferential tariffs on more than 500 items, mostly agricultural products.

Agricultural trade between China and ASEAN members got a boost this year as China imported a total of US$330 million worth of fruits and vegetables from ASEAN countries in the first half of the year, an increase of 38.7 per cent year on year. During the same period, China's exports stood at US$270 million, jumping by 33.9 per cent.

An said China and ASEAN will be closer trade partners once the work to build FTA is started.

Trade volume between ASEAN nations and China accounts for 11 per cent of China's overall external trade.

ASEAN's exports to and imports from China reached US$47.3 billion and US$30.9 billion in 2003. These numbers represent an increase of 51.7 per cent and 31.2 per cent, respectively from the previous year.

In the first three quarters of this year, foreign trade volume between China and ASEAN reached US$75.4 billion, rising 35.6 per cent year on year.

During a summit in Bali last October, a decision was made to hold the first China-ASEAN Expo from November 3 to 6 in Nanning, capital of the Guangxi Zhuang Autonomous Region.

Booths have proven popular, An said. By the end of August, 4,261 enterprises had filed applications to fill the 1,763 booths available.

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