The central government is considering the proposal by the Hong Kong
government to establish a free trade zone covering the mainland and
the
Special
Administrative Region (SAR), Vice Foreign Trade Minister Long
Yongtu said yesterday.
A
free trade zone would probably play an active role in bringing
mainland-Hong Kong economic ties closer, Long told reporters on the
sidelines of the 14th General Meeting of the Pacific Economic
Co-operation Council (PECC) in Hong Kong.
He
said Macao - another SAR under the "one country, two systems"
principle - should have no problem in joining the proposed free
trade zone.
It
would be difficult, however, to hold any free trade zone talk with
Taiwan for the moment, as the island has shunned the issue of
resuming direct three (trade, transport and postal) links across
the Taiwan Straits, he said.
The idea of such a free trade zone does not violate the principle
of the World Trade Organization
(WTO), Long said.
At
a press briefing during the PECC conference, Mike Moore, director
general of WTO, shared the view that such an idea is in line with
WTO rules. He cited the example of the European Union and the North
America Free Trade Zone.
Earlier this month, China and 10 Southeast Asian nations agreed to
set up a free trade area within 10 years.
Experts said establishment of the free trade zone will give an
impetus to Hong Kong's economy, which is experiencing the pain
caused by restructuring and the global economic slowdown.
The new situation after China's WTO accession calls for a new
pattern of economic relations among the mainland, Hong Kong and
Macao, Long told a PECC meeting.
China has in place a market economy and an open trading policy and
the ability to achieve sustainable economic growth. The economy is
expected to grow by at least 7 percent annually in the next five
years.
It
has taken China a "tremendous effort" to achieve this in the past
15 years by improving transparency in its legal system and
committing itself to gradual market opening-up, he said.
China is now well prepared to handle the challenges and
opportunities of economic globalization, Long said.
China is determined to honor its commitments to WTO and be a
responsible member, Long said.
He
admitted that difficulties would arise in fulfilling its
commitments in fields such as protection of intellectual property
rights (IPR).
IPR protection, however, is also crucial for China in upgrading its
technological power and raising the quality of foreign direct
investment, he noted.
(China Daily November
29, 2001)