Business     

China aims FTA with Japan and South Korea

China Daily, December 16, 2011

• China is actively pushing for a proposed free trade agreement (FTA) with Japan and South Korea and hopes the negotiations will start next year, officials said on Thursday.

  "China, Japan and South Korea are all important countries in East Asia but with different international divisions of labor. A free trade zone among the three countries, if established as soon as possible, would benefit the economic development of all through developing trade and investment potential in East Asia," said Shen Danyang, the spokesman for China's Ministry of Commerce, at a regular briefing in Beijing on Thursday.

  Shen added that a free trade zone would also help economic integration among the three countries.

  "China is actively pushing forward an investment accord with Japan and South Korea. As for the progress on the FTA, representatives of the three countries are currently in South Korea conducting the last round of talks on the feasibility of the free trade zone. The talks have made positive progress," he said.

  Wang Zaibang, vice-president of the China Institute of Contemporary International Relations, said that he is "very optimistic" about the future of the proposed FTA.

  "The economies of the three countries are closely related and the establishment of a free trade zone, including the reduction of tariffs, will benefit all three economies in the future. That is why all three countries are positive about the prospects for the zone," Wang said.

  During the sixth East Asia Summit in November, Premier Wen Jiabao called for joint efforts from the three countries to end their research by the end of the year, so that negotiations can start in 2012.

  However, Zhang Yunling, director of the division of international studies at the Chinese Academy of Social Sciences, expressed concern that the FTA negotiations would not be smooth because of the "different economic structures of the three countries".

  "While Japan and South Korea are concerned about opening their agriculture sectors, China, which has the lowest level of industrialization of the three nations, has too many areas to worry about in opening up its market," Zhang said.

  During the recent APEC Summit in Honolulu, Japan showed interest in becoming part of the Trans-Pacific Partnership Agreement (TPP) when the United States promoted the multilateral trading agreement, which involves a number of countries on both sides of the Pacific. However, experts said that the TPP will advance, rather than hamper, the progress of the FTA.

  "The TPP will not impede the progress of the FTA between China, Japan and South Korea but will pressure the three parties to speed up its establishment. While the FTA would advocate the opening up of the three markets, the TPP promotes a much deeper and broader agreement covering topics such as labor, and environmental protection, which are not included in the proposed FTA," Wang said.

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