“China Free Trade Area Network” Launched Officially
“China Free Trade Area Network” was launched officially on 27 September 2008. It focuses on the situation of China Free Trade Area construction, the development and achievements of China Free Trade Arrangements (FTAs) negotiations, and the services that the FTA-negotiation-related Ministries provide. Moreover, it embraces a strong database of FTA text that China has signed and FTA tariff concessions information for online searching, along with interactive FTA Q&A function.
Background
In the course of economic globalization, regional economic integration, with Free Trade Area as its main form, has been growing dramatically. The major Powers and regional Groups accelerate the development of FTAs. By the end of August 2008, there have been 213 FTA-focused Regional Trade Arrangements (RTAs) proposed to the WTO and being effective, covering more than half of global trade in goods.
Free Trade Area and Its Trend of Global Development
Free trade area is a designated group of countries that have agreed to eliminate tariffs, quotas and preferences on most (if not all) goods between them. It aims to reduce barriers and realize liberation of trade and investment. As a WTO Plus, FTA entitles its members more preferential treatment than that does the other WTO members. It is such a complementary to the WTO free trade regime that provides the FTA member economies with much more economic space to realize mutual benefits.
The dynamic growth of Free Trade Area has cast a profound impact on the world economic situation. As the experts from the WTO estimate, more than half of the world trade deal internally in various regional Groups with most favored nation treatment. Many countries tend to take advantage of FTAs, especially when the Doha Round talks meet with difficulties.
Developments of China’s Free Trade Areas
China signed its ever first FTA in 2003. Since then, it has established 12 free trade areas with 29 countries from Asia, Oceania, Latin America, Europe and Africa. China’s major FTAs include:
In order to further enhance the level of economic and trade exchanges and cooperation between the Mainland China and Hong Kong/Macao, CEPA was signed in 2003 and followed 4 Supplementary Agreements. Supplementary Agreement V was signed in July 2008. In the aspect of goods trade, the Mainland had implemented zero tariffs on Hong Kong/Macao originated goods. Besides, the Mainland has eased market access in 40 areas, including law and accounting. In terms of Trade and Investment Facilitation, cooperation has been developed in 9 fields between the Mainland and Hong Kong/Macao, such as trade/investment promotion and Customs facilitation. The implementation of CEPA and its Supplementary Agreements further enhances the level of economic and trade growth in Hong Kong and Macao.
In the 6th China-ASEAN high-level meeting, which was held in November 2001, the Framework Agreement on Comprehensive Economic Cooperation between China and ASEAN was agreed. 2 years later Agreement on Commodity Trade of China-ASEAN Free Trade Area (CAFTA) was signed and the Agreement was put into effective in July 2005. In 2010 and 2015, China will eliminate most of the tariffs on 6 old and 4 new members of ASEAN respectively. Since tariff reduction, the economic and trade cooperation between China and ASEAN has developed rapidly. Now the two parties focus on the negotiation on investment.
China-Chile Free Trade Agreement was signed in November 2005 and implemented in October 2006. According to the Agreement, tariffs on 97 percent tariff lines will be reduced to zero in 10 years. Supplementary Agreement on service trade was signed in Sanya on 13 April 2008 and it will help the two countries to open the service market mutually and improve the investment conditions to gain more benefits for their people.
China-Pakistan FTA was signed in November 2006, which was the major achievement in Chinese President’s visit to Pakistan. It was convinced that progressive reduction and elimination of trade barriers through the conclusion of a FTA, will facilitate a win-win scenario and mutual development of the two Parties. Now the two countries are on the phase of service trade negotiations.
China and New Zealand signed a FTA on 7 April 2008 and planed to put it into effect since 1 October 2008. The importance of this FTA can be categorized into four “Firsts”: New Zealand was the first country to complete bilateral negotiations for China’s entry into the WTO, the first country to recognise China’s status as a full market economy, the first developed country to open negotiations on a free trade zone with China, and the first developed country to complete a free trade agreement with China. These four “firsts” in the history of economic relations with China are especially eye-catching.
The development of China’s free trade areas plays an important economic and political role in China’s strategies of opening and pursuit of a harmonious world. This trade giant will take advantage of FTAs to achieve mutual benefits with other economies.
“China Free Trade Area Network” can be viewed at http://fta.mofcom.gov.cn.