Free trade zones are clearly the way to go

By Sun Yuanjiang (China Daily)

In the last decade, China has signed free trade agreements with quite a few other countries for mutual trade benefits, notably with the Association of Southeast Asian Nations (ASEAN) nations, especially in machinery and electronic products. 

So, China is establishing 15 free trade zones focused on 28 economies and has signed 10 related agreements. 

Last year, its machinery and electronic product exports to ASEAN countries accounted for 53.4 percent of total exports, compared with 39.5 percent in 2003. China and ASEAN signed a bilateral trade agreement in 2004, another benefit of its joining the World Trade Organization a decade ago. 

One leading Chilean newspaper reported that the China-Chile Free Trade Agreement, which took effect in 2006, created nearly 40,000 jobs in the South American country. 

Last year, trade between China and its free-trade partners was worth $782.6 billion and accounted for 26.3 percent of China's total trade. Free trade negotiations with Australia, the (eight-member) Gulf Cooperation Council, Switzerland, Norway and Iceland are under way, and a feasibility study on an agreement with India has been completed. 

And, a study on free trade zones with Japan and South Korea is expected to be finished by the end of this year. 

China is also looking at free-trade-zone agreements with members of the Shanghai Cooperation Organization. 

In its approach to free trade zones, China has taken a clear stand on trade protectionism, in the midst of the global financial crisis, as part of an understanding that trade subsidies would be reduced. As of today, China's market economy moves have been recognized by 21 free trade partners.