China’s free trade agreements with the Republic of Korea (ROK) and Australia came into effect on Dec 20, giving the countries an edge in their efforts to boost exports of goods and services.
Under the deal with Australia, tariffs on 95 percent of Australian exports have been lifted, while obstacles will be removed to allow more Chinese businesses to invest in the country. Visas will also be relaxed for Chinese visitors.
The deal with the ROK will see China remove tariffs on 91 percent of ROK products over the next 20 years, while the ROK will eliminate tariffs on 92 percent of Chinese goods.
Companies of the ROK expect exports from China to grow in value to $1.35 billion by the end of next year thanks to the FTA, according to the ROK’s Ministry of Strategy and Finance.
China is the ROK’s biggest trading partner and largest export market. The ROK is also one of China’s biggest foreign investors.
China is already Australia’s largest export market, with commodities, natural resources and agricultural products at the top of its export list.
“These two FTAs will help speed up negotiations on other FTAs and the Regional Comprehensive Economic Partnership,” said Shen Danyang, spokesman for China’s Ministry of Commerce.
Lin Guijun, vice-president of the University of International Business and Economics, said, “The three countries were keen to conclude the deals as early as possible to boost exports to China, as well as gain the support of the public and companies to strengthen their political position.”
Lin said the ROK and Australia FTAs have advanced articles on service trade. Investment is also important, as the countries are major overseas investment destinations for Chinese companies.