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1
ASEAN CHINAthe New Economic Partnership

• Mr. Zhou Hongli
• Minister Counsellor
• Embassy of Peoples Republic of China
• February 18, 2004

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Main Topics

• Economic cooperation between China and ASEAN
• ASEAN-China Free Trade Area (ACFTA)
• China ASEAN Expo

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China and ASEAN Close Neighbors

• Chinas foreign policy
• 1. To build friendly relationship and
  partnership
• with neighbors (????,????)
• 2. To build amicable, tranquil and prosperous
• neighborhood (??,??,??)
• Friendly co-operative relations serves the
  fundamental interests of our peoples and the
  stability and development of the region.

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China-ASEAN Comprehensive Economic Cooperation

• Bilateral Trade ASEAN remains Chinas the 5th
  largest trading partner in the past 10 years.
• Two-way investments, and contracting projects and
  labor service have increased tremendously.
• Close cooperation in international and regional
  economic arena WTO, APEC, ASEM, ASEAN3,
  ASEAN-China FTA, etc.

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Characters of Bilateral Trade

• Grew fast 20 annual increase since 1990
• Share in Chinas total trade rose from 5.9 in
  1990 to 9.2 in 2003
• Trade balance in favor of ASEAN countries
  (US16.4 billion in 2003)
• Chinas largest trading partner in ASEAN
  Malaysia overtook Singapore since 2002.

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Fast Trade Growth b/n China and ASEAN
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Trade with ASEAN Members in 2003(in million US
dollars)
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Malaysia has the Largest Shares
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Trade Target

• China and ASEAN leaders agreed the trade between
  China and ASEAN shall reach US100 billion in
  2005.
• Achievable need only 13 annual growth in the
  next two years.

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ASEAN Total Investment to China(by the end of
2003)

• Total projects 22075
• Share in Chinas total 4.75
• Total contractual amount US64.59 billion
• Share 6.84
• Total paid-up investment US32.37 billion
• Share 6.46

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Singapore is the Largest ASEAN Investor in China
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Total Chinese Investment in ASEAN ( by the end of
2003,in million US)
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Shares of Chinese Investment in ASEAN against in
Asia and the World
Share in Asia
Share in the world
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Process of Establishing ACFTA

• At the 4th ASEANChina (101) Summit in Singapore
  in November 2000, leaders of ASEAN and China
  agreed to explore the possibility of establishing
  a free trade area (FTA).
• The ASEAN and China Expert Group on Economic and
  Cooperation was formed to study the feasibility
  of FTA.

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Process of Establishing ACFTA

• At 5th ASEANChina Summit in Brunei in November
  2001, leaders endorsed the proposal made by the
  Expert Group for a Framework on Economic
  Cooperation and to establish an ASEAN-China Free
  Trade Area within 10 years.
• Trade Negotiation Committee was formed to
  negotiate tariff reduction or elimination.

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Process of Establishing ACFTA

• At 6th ASEANChina Summit in Cambodia in November
  2002, leaders singed Framework Agreement on
  Comprehensive Economic Cooperation between ASEAN
  and China.
• The Agreement is the groundwork for establishment
  of ACFTA by 2010 for the 6 older ASEAN members
  and 2015 for 4 newer members.

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Process of Establishing ACFTA

• At 7th ASEANChina Summit in Indonesia in October
  2003, leaders signed Protocol to Amend the
  Framework Agreement.
• to concrete certain issues, especially Early
  Harvest Programme, which already started on
  January 1 2004, and Rules of Origin

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What to happen in 2004

• ASEAN and China agreed negotiations for the trade
  in goods component of the FTA will be concluded
  by 30 June 2004

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Significance of ACFTA

• Third largest FTA in terms of economy and trade,
  next to NAFTA and EU.
• The Largest FTA in terms of population
• 1.7 billion of population
• US2000 billion of GDP
• US 1200 billion of trade
• Unlike NAFTA and EU, ACFTA is dominated by
  developing countries.

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ACFTA Tariff Reduction

• Products in the Normal Track
• tariff rates to be gradually reduced or
  eliminated over a period from 1 January 2005 to
  2010 for ASEAN 6 and China, and from 1 January
  2005 to 2015 for ASEAN 4
• Products listed in the Sensitive Track 
• tariff rates to be reduced in accordance with
  the mutually agreed end rates and end dates.

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Early Harvest Programme
Tariff reduction commenced from January 1 2004,
0 tariff rates by 2006. It covers more 500
products, mostly agricultural products listed in
the first 8 Chapters of HS Code.
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Rules of origin

• At least 40 of contents from ACFTA

Trade in service
For services and investment, negotiations
commenced in 2003 and would be concluded as
expeditiously as possible. 
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ACFTA also Covers Cooperation in Other Areas

• Cooperation in 5 priority sectors, namely
• (a) agriculture
• (b) information and communications technology
• (c) human resources development
• (d) investment and
• (e) Mekong River basin development.

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• And other areas banking, finance, tourism,
  industrial cooperation, transport,
  telecommunications, intellectual property rights,
  small and medium enterprises (SMEs), environment,
  bio-technology, fishery, forestry and forestry
  products, mining, energy and sub-regional
  development.

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Other Measures Relating to Trade

• Elimination non-tariff barriers
• Progressive liberalisation of trade in services
  with substantial sectoral coverage
• Establishment of effective trade facilitation
  measures, including, but not limited to,
  simplification of customs procedures and
  development of mutual recognition arrangements

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Welcome to CHINA-ASEAN EXPO

• At the 7th ASEANChina(101) Summit Meeting, on
  October 8 2003, Chinese Premier Wen Jiabao
  suggested that a ChinaASEAN Expo be held yearly,
  starting from 2004, in Nanning, China to promote
  mutual commercial cooperation.
• Chinese Premiers proposal was welcomed by ASEAN
  leaders and was later written into the Chairman's
  Statement of the Summit

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Purpose of CHINA-ASEAN EXPO

• To promote the construction of China-ASEAN
  Free Trade Area (CAFTA), sharing opportunities of
  cooperation and development.

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• TIME AND VENUE
• Every November, starting from 2004, in Guangxi,
  China
• This year November 3-6, 2004, at Nanning
  International Convention and Exhibition Center.

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• SPONSORS AND ORGANIZERS
• Sponsors Ministry of Commerce of China
  Ministries of Trade or Commerce of ASEAN
  Members
• Organizer Government of Guangxi Zhuang
  Autonomous Region, China

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• SCALE OF THE EXPO
• Accommodates 2,000 international standard
  exhibition booths,
• 200 non-standard booths
• An outdoor exhibition area of 26,000 square
  meters.
• It is estimated to receive some 20,000
  businessmen worldwide.

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• ACTIVITIES
• Trade in goods to promote trade among ACFTA
  members
• Talks on investment to enlarge two-way
  investment in ACFTA, introducing investment
  environment, releasing investment information
• Trade in services and other areas of cooperation
  to promote the flow of capital, information,
  talents, enhance the cooperation in tourism,
  telecommunication, logistics, finance, project
  contracting and other areas

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• ACTIVITIES
• Theme seminars on hot topics of CAFTA
  construction, which invite the attendances of
  government officials, experts, researchers, and
  entrepreneurs
• Culture exchange showing the splendid culture of
  all nations that would further promote mutual
  understanding and friendship

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For Participation and More Information

• 1. IE Singapore
• Mr. Lim Kay Siong
• Tel [phone]
• Fax [phone]
• 2. Guangxi Economic and Trade Commission
• Mr. Nong Rong or Ms. Huang Yuan
• Tel [phone] or 2109509
• Fax [phone] or 2109266
• Email caexpo_at_caexpo.org
• Website www.caexpo.org