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2015 Business Review III錛歅ositive Progress Made in FTA Construction

In 2015錛MOFCOM accelerated the implementation of free trade area strategy, made active efforts to step up FTA construction and improve the overall layout of FTA. Great achievements have been made.

So far, China has signed and implemented 14 free trade agreements with 22 countries and regions, with trading partners covering Asia, Latin America, Oceania and Europe. Those FTAs were signed with ASEAN, ROK, Australia, Singapore, Pakistan, Iceland, Switzerland, Chile, Peru, Costa Rica, and New Zealand, including CEPA (Closer Economic Partnership Arrangement) between the Mainland and Hong Kong, the Mainland and Macao, and ECPA(Economic Cooperation Framework Agreement) between the mainland and Taiwan. China is also stepping up other FTA negotiations, including RCEP (Regional Comprehensive Economic Partnership), China-Japan-ROK FTA, and China-GCC (Gulf Cooperation Council) FTA. In general, the FTA construction has promoted trade and economic cooperation between China and relevant countries and regions, and achieved mutually beneficial results. The main progress China has made on FTA construction in 2015 is as follows:

Firstly錛successfully signing and implementing the China-ROK Free Trade Agreement. With more than two years鈥negotiation, the China-ROK Free Trade Agreement was signed by Chinese Minister of Commerce Gao Hucheng and Minister of Trade, Industry and Energy Yoon Sang-jick in Seoul on June 1, 2015. The agreement has entered into force after the two countries鈥respective domestic procedures on December 20, 2015. The China-ROK FTA involves the largest trade value among all FTAs that China has signed. It鈥檚 a mutually beneficial agreement between China and South Korea, realizing the goal of reaching an 鈥渆ven interest, comprehensive and high-level FTA鈥 According to the agreement, at the opening level, the percentage of trade liberalization for bilateral trade in goods will cover over 90% tax items and 85% trade value. The agreement covered 17 areas concerning trade in goods, trade in service, investment and rules, involving topics like e-commerce, competition policy, government procurement and environmental protection. In addition, both sides were committed to continuing to carry out negotiations on trade in services with a negative list after the agreement came into force. They promised to step up investment negotiations by pre-access national treatment together with a negative list.

Secondly, successfully signing and implementing China-Australia Free trade Agreement. With ten years鈥negotiation, the China-Australia Free Trade Agreement was officially signed on June 17, 2015. It has entered into force on December 20, 2015 after completing the two countries鈥respective domestic procedures. The FTA has realized the goal of 鈥渃omprehensive, high-quality and balanced interest鈥 and is one of the FTAs that enjoy the highest level of trade and investment liberalization among all that China has signed with other countries so far. It has innovated the negotiation modes in some areas. In the service sector, Australia is committed to opening its service sector to China through a negative list once the FTA comes into force. It鈥檚 the first country in the world to make commitments to China in trade in service through a negative list, and China will also open its service sector by a positive list. Specific arrangements in holiday working mechanism were also made to China by the Australian side. In investment area, the two sides will give each other the most preferential treatment when the FTA enters into force. They also agreed to negotiate on open and upgrading investment and service by way of negative list in the future.

Thirdly, completing negotiations on upgrading China-ASEAN FTA and signing the Protocol on Revising the China-ASEAN Comprehensive Economic Cooperation Framework Agreement as scheduled. After four rounds of negotiations within two years, on November 22, 2015, Minister Gao hucheng, together with ministers from ten ASEAN countries, on behalf of their own government, officially signed the Protocol on Revising the China-ASEAN Comprehensive Economic Cooperation Framework Agreement (hereinafter referred to as the Protocol) in Kuala Lumpur, the capital city of Malaysia. At present, both sides are striving to promote the protocol to take effect in 2016 as soon as possible. The protocol is the first upgrading agreement completed on China鈥檚 present FTA basis, covering trade in goods, trade in service, investment, customs cooperation and trade facilitation, and economic and technological cooperation, etc. It has enriched, improved and supplemented the contents of the original agreement, and reflected the common wish for deepening and expanding China-ASEAN trade and economic cooperation. The upgrading of China-ASEAN FTA will provide new impetus for bilateral economic cooperation, accelerate the construction of a closer community of common destiny between China and ASEAN, promote to realize the goal of US$1 trillion bilateral trade value by 2020, and step up RCEP (Regional Comprehensive Economic Partnership) negotiations and Asia-Pacific FTA process.

Fourthly, promoting substantive progress on RCEP negotiations. Launched in 2012, the RCEP is the largest free trade zone underway in Asia at present, covering more than half of world鈥檚 population, taking up 30% of world鈥檚 total in terms of economic and trade size, with the world鈥檚 two largest population鈥擟hina and India included. In 2015, positive progress in negotiations was made because of China鈥檚 efforts. At RCEP Trade and Economic Ministers鈥Meeting held in August 2015, with China鈥檚 efforts and guidance, China鈥檚 plan was adopted to comprehensively conclude the model negotiations and enter into the stage of substantive negotiations. At East Asia Summit held in November 2015, the RCEP leaders also agreed that all members should strive to end negotiations in 2016.

In addition, China made active efforts to step up negotiations on China-ROK FTA, China-Sri Lanka FTA and the second phrase of China-Pakistan FTA. China also launched the negotiations on China-Maldives FTA, China-Georgia FTA and the upgrading of China-Singapore FTA in 2015.

In 2016, MOFCOM will continue to genuinely implement Some Opinions on Accelerating and Implementing Free Trade Area Strategy issued by the State Council in accordance with the requirements of the central committee and State council, quicken up the construction of FTA network that standing on neighborhood, radiating countries along the 鈥榖elt and road鈥 and facing the globe. Meanwhile, efforts will be made to carry out FTAs that have entered into force, help domestic enterprises better use preferential policies along with FTA, and enhance China鈥檚 foreign trade and investment cooperation.

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