Deal signed for free trade area
1 January 2003
China and the Association of South-east Asian Nations have signed a framework agreement to set up a comprehensive free trade area. The deal was agreed at Asean's meeting at Phnom Penh in November, which was attended by Premier Zhu Rongji. It is envisaged that the free trade area will be in place by 2010 but the four weakest Asean members, Vietnam, Laos, Cambodia and Burma will have until 2015 to comply with the terms. Negotiation of the detailed arrangements will start in 2003, but the framework agreement includes a number of categories of goods that will attract reduced tariffs within three years mostly agricultural items such as fruit and vegetables.
A separate agreement intended to avoid conflict over the Spratly Islands was also signed at the meeting. Under this non-binding agreement, China and the members of Asean agreed to exercise self-restraint and to avoid activities that would complicate or escalate the dispute over the islands, which are claimed in whole or in part by China, Vietnam, the Philippines, Brunei and
Malaysia. They also undertook to use peaceful means to settle the dispute and to provide
advance notice of any military exercises in the disputed waters.