The mainland will expand the scope of a free trade pact with
Hong Kong in the coming months, said an official familiar with the
discussions who did not want to be named.
The fifth phase of the Closer Economic Partnership Arrangement
(CEPA) between the mainland and Hong Kong is likely to be signed
before the 10th anniversary of Hong Kong's return to the motherland
in July, he said recently.
The official said the Ministry of Commerce and the government of
the special administrative region had reached a consensus at a
conference last month on expanding the opening up of services trade
and facilitating investment.
The official did not reveal details, but analysts in Hong Kong
predicted that the new deal may allow Hong Kong businesses to use
renminbi to settle some transactions, such as for imports from the
mainland.
Since the signing of the CEPA on June 29, 2003, the two sides
have been working closely to broaden the arrangement. The second,
third and fourth phases of the agreement were launched in October
2004, October 2005 and June last year.
So far, the agreements cover nearly all products from Hong Kong
as well as services and investment between the mainland and Hong
Kong.
By the end of January, cargoes worth HK$7 billion have benefited
from zero-tariff treatment; and the Hong Kong government has issued
1,700 certificates to service providers who benefit from CEPA,
figures from the Hong Kong government showed.
The previous phases of the free trade pact have helped the SAR
recover strongly from the economic downturn following the Asian
financial crisis in 1998 and the outbreak of the SARS epidemic in
2003.
All the liberalization measures apply to Macao, with minor
differences due to its different economic structure.
(China Daily March 6, 2007)