The plan for Hong Kong to sell its products to the mainland free of tariffs is unlikely to become a reality this year.
"I'd better not try to tell you when the agreement will be made," Li Guanghui, deputy director of the Trade Academy's Asia and Africa Department under the Ministry of Foreign Trade and Economic Cooperation, said Monday.
But he added that the zero-tariff treatment for Hong Kong will be granted at an early date to show the central government's special concerns over the SAR's economy.
Government departments in Beijing are continuing their work of turning the idea into a practical reality. The date for the scheme to be initiated depends on the results of this research, he said.
He rejected conjectures that there are disparities among government departments over the granting of special treatment to Hong Kong, saying that they have instead reached consensus on the issue.
But studies are yet to be finished in Beijing and additional exchanges of views and opinions are needed between the mainland and Hong Kong on how to define "made-in-Hong Kong" products, he said.
The mainland authorities are reportedly worried about the possibility that foreign-made goods would swamp the mainland market through Hong Kong, where the zero-tariff treatment is granted to goods imported from all over the world.
Li said the key question is how to define genuinely made-in-Hong Kong products - a core factor for the closer economic partnership arrangement (CEPA) between the two sides.
The CEPA scheme aims to provide Hong Kong businesses easier access to mainland markets in the wake of China becoming a member of the World Trade Organization.
Deadlines have been set for studies on certain issues but there is no timetable for solving differences on the establishment of CEPA.
Hong Kong trade officials reportedly said an agreement could be expected within two to three months.
Li said that the earlier the CEPA scheme is realized, the better for the economic development of the Pearl River Delta region.
He remained optimistic about the prospect for CEPA as he believes that China has to achieve that first before it opens up to the ASEAN economies.
Efforts by China and the ASEAN countries to set up a free trade zone will turn out to be a boost to the CEPA plan, he said.
Premier Zhu Rongji and ASEAN leaders agreed last November to set up a free-trade area in 10 years, and talks on the issue are under way.
Efforts to set up the zone will help justify an early establishment of CEPA, Li told China Daily.
(China Daily June 18, 2002)
