Singapore, China to launch free-trade talks in November

Asian Economic News, May 17, 2004

SINGAPORE, May 15 Kyodo

China and Singapore will launch negotiations for a free-trade pact in November, and will go ahead with the plan even if an ASEAN-China free-trade deal currently under negotiation stalls, Singapore media reported Saturday, quoting Singapore Deputy Prime Minister Lee Hsien Loong.

Lee, who is in China on a five-day visit, told Singaporean journalists after an hourlong meeting Friday with Chinese Premier Wen Jiabao that bilateral free-trade talks will begin during a summit between the Association of Southeast Asian Nations and its three East Asian partners China, Japan and South Korea, which has been slated for November in the Laotian capital Vientiane.

When Singapore first revealed the plan for a free-trade pact with China last November, it said the two countries will begin the trade talks only after ASEAN and China have wrapped up their negotiations for a free-trade deal, possibly sometime in the middle of this year.

They have apparently shifted their stance. Lee said Singapore and China will launch their bilateral talks regardless of the progress in the ASEAN-China talks.

''Whatever happens to the ASEAN-China FTA, we are going to launch the Singapore-China negotiations in November,'' he was quoted as saying.

But he was optimistic that the ASEAN-China deal is progressing smoothly and likely to be completed in the next few weeks.

As for the proposed China-Singapore free-trade pact, Lee said he thinks it will be smooth sailing due to the lack of difficult issues such as agriculture.

Singapore's trade with China last year jumped 31 percent to S$36.9 billion ($21.4 billion), making it Singapore's fifth-largest trading partner after Malaysia, the United States, the European Union and Japan.

With a cumulative contractual investment value of $44.7 billion as of 2003, Singapore is China's seventh-largest investor.

The number of Chinese firms in Singapore has swelled from 509 in 1999 to 1,161 in 2003.

Singapore has already forged free-trade deals with Japan, the United States, Australia, New Zealand and the European Free Trade Association. It is conducting talks with Bahrain, Canada, Egypt, India, Jordan, Mexico, Panama, South Korea and Sri Lanka, plus a trilateral free-trade deal between Singapore, New Zealand and Chile.