On July 22, Chinese Foreign Minister Yang Jiechi attended the China-ASEAN (10 +1) foreign ministers conference held in Singapore for a discussion on major issues such as the relations between China and ASEAN. There is no question that the 10 ASEAN countries are China's good neighbors, friends and partners. Since China and the ASEAN initiated formal dialogue in 1991, the two sides have continued to cooperate in political, economic, social, cultural, and other matters. Looking ahead at the next 10 years to come, as the regional organization of developing countries, ASEAN is very likely to supersede Japan and the United States as China's more important trade partner and significantly alter China's foreign trade pattern.
In 2002, China and ASEAN leaders signed the "Framework Agreement on China-ASEAN Comprehensive Economic Cooperation" and decided to build a China-ASEAN free trade zone by 2010. In July of 2005, the "Goods Trade Agreement" of the China-ASEAN free trade zone took effect. The two sides lowered tariffs for more than 7,000 kinds of commodities. In January 2007, China and ASEAN signed the "Service Trade Agreement." These measures have vigorously promoted the volume of bilateral trade.
From 1991 to 2007, the trade volume between China and the ASEAN increased 23 times from $8.408 billion to $202.55 billion. China and the ASEAN became one another's fourth largest trading partner. In the first five months of this year, China-ASEAN trade rose 26.9% over the same period of last year, exceeding the 13.3% in Sino-US trade growth and 16.8% in Sino-Japan trade growth. If maintains its current development rate, it is estimated that in 2009, ASEAN trade with China will exceed total trade between China and Japan; and thus make ASEAN China's third largest trade partner. By 2010, the China-ASEAN free trade zone will be established, after which China will liberalize trade with six traditional ASEAN member countries. By 2015, China will establish free trade in goods with Cambodia, Laos, Myanmar and Vietnam. If all goes well, the ASEAN may even supersede the United States before 2015 as China's second largest trade partner only next to the EU.
Regarding bilateral investment, by the end of 2007, China actually used $763 billion in foreign investment, of which 19.3% was from the ASEAN, Japan and South Korea. In East Asian countries, there are a total of 1,950 Chinese enterprises, involving a direct investment of $3.52 billion. By the end of 2006, the accumulated direct investment of ASEAN countries in China reached $42.6 billion. The top three ASEAN investors are Singapore, Malaysia and Thailand. Of this, Singapore's investment in China totaled $30 billion, accounting for 70% of ASEAN's total direct investment in China. China's direct investment in ASEAN countries amounted to $937 million, accounting for 1.79% of the foreign direct investment that ASEAN had absorbed. Obviously, there is still great potential for mutual investment growth.
In terms of regional cooperation, China, Cambodia, Laos, Myanmar, Thailand and Vietnam jointly set up Greater Mekong Subregion (GMS) Economic Cooperation Programs in 1992 which play an important role in strengthening regional economic cooperation and promoting development. So far, about 180 cooperation projects have been initiated in nine areas: transportation, energy, telecommunications, environment, agriculture, human resources development, tourism, trade facilitation and investment. Currently, all 10 ASEAN countries have become tourist destinations for Chinese citizens. Personnel contacts between the two sides reached more than 6.6 million person-times annually. In March this year, China and the ASEAN jointly announced the establishment of the "GMS group for exchanges and cooperation in agricultural science and technology" in a seminar held in Kunming. Later, the third summit of GMS leaders was held in Vientiane, Laos. Leaders of these countries cut the ribbon for the formal completion and opening of the Laos section of the Kunming-Bangkok highway. The first phase of the GMS information highway was also completed and put into operation. In the summit, heads of countries also put forward cooperation plans for the next five years. All these events indicate that China and the ASEAN will continue development in bilateral economic and trade relations and the prospects are promising.
By People's Daily Online
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