At a meeting of the Joint Council for Bilateral Cooperation co-chaired by Chinese vice premier Wu Yi and Singapore's deputy prime minister Wong Kan Seng in Beijing, Singapore and China on Aug. 25 agreed to launch negotiations for a free trade agreement, the city-state's trade ministry said.
"Building on existing frameworks of cooperation, the enhanced liberalization in goods, services and investments are expected to benefit the people and economies of both countries," the statement said. "The FTA will also provide businesses and investors with improved policy regimes to enhance trade and investment."
The China-Singapore FTA will also contribute to regional economic integration by injecting additional momentum into the establishment of the China-ASEAN Free Trade Area said the statement. The Association of Southeast Asian Nations groups Singapore with nine other countries.
Bilateral trade in 2005 reached a record of $33.15 billion, up 26% from 2004. China is now Singapore's fourth largest trading partner while Singapore is China's seventh biggest trading partner. China is also Singapore's top investment destination, with cumulative actual investments totaling nearly $28 billion at the end of last year.
Singapore is also China's sixth largest foreign investor and the largest from ASEAN. Singapore has signed free-trade pacts with its major trading partners, including the U.S., Japan, Australia and New Zealand.
Copyright Agence France-Presse, 2006