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China, Chile mull upgrading FTA amid closer trade ties

Updated: May 26,2015 2:17 AM     Xinhua

SANTIAGO — China and Chile on May 25 signed a host of cooperation deals including a multi-billion-US-dollar currency swap pact as the two countries move to enhance their trade and financial ties.

The move came after a meeting between visiting Premier Li Keqiang and Chilean President Michelle Bachelet, who jointly witnessed the signing of several bilateral business contracts and governmental accords in politics, trade, finance and science and technology.

China agreed to grant a quota of 50 billion yuan ($8.1 billion) to RMB qualified foreign institutional investors in the South American country, according to a joint declaration issued on May 25 after their meeting.

And the three-year currency swap deal worth 22 billion yuan ($3.5 billion) signed between the central banks of China and Chile is aimed at promoting the bilateral trade and investment, according to a statement on the website of the People’s Bank of China, China’s central bank.

And the two countries agreed to explore the possibility of upgrading their decade-old free trade agreement (FTA) to further promote bilateral trade and investment, said the joint declaration.

“The two sides believe that it is necessary to explore the possibility of upgrading the FTA to push forward the lasting development of the bilateral trade cooperation,” said the document, adding that teams from the two countries will start the work no later than August.

Chile was the first South American country to establish diplomatic ties and the first in the region to sign an FTA agreement with China.

Two-way trade between China and Chile reached $34.1 billion last year, four times greater than before the signing of the pact in 2005. China is also Chile’s biggest trade partner as well as largest buyer of copper products.

The declaration said that the Chinese and Chilean governments also agreed to “actively conduct production capacity cooperation and expand investment in mining, agriculture, infrastructure construction, energy and manufacturing to promote industrial connection and integration.”

The two countries will continue to support each other on major issues concerning their respective interests and enhance mutual understanding and trust, it said.

This year marks the 45th anniversary of the establishment of China-Chile diplomatic ties.

According to the joint declaration, the two countries agreed to expand cooperation in such areas as culture, education, tourism, youth exchanges, antarctic scientific research, astronomical observation and earthquake prevention and disaster reduction.

They also agreed to strengthen cooperation under the framework of Asia-Pacific Economic Cooperation, of which both are members, and simplify visa application process to promote tourism and personnel exchanges.

Chile is the last leg of Premier Li’s four-nation tour to Latin America, which has already taken him to Brazil, Colombia and Peru.