Singapore and China have signed a Free Trade Agreement (FTA).
It was inked in Beijing earlier today in a ceremony witnessed by Singapore Prime Minister Lee Hsien Loong and Chinese Premier Wen Jiabao.
The China-Singapore Free Trade Agreement (CSFTA) will take effect Jan 1, 2009, once both parties have completed the necessary legislative processes.
This is the first comprehensive bilateral FTA that China has signed with another Asian country, covering trade in goods, trade in services, rules of origin, trade remedies, sanitary measures, technical barriers to trade, customs procedures, economic cooperation and dispute settlement, among others.
According to a statement from the Ministry of Trade and Industry, "the agreement will enhance Singapore companies' access to the vast Chinese market and further boost our excellent bilateral trade and investment relations".
Currently, China is Singapore's third largest trading partner and largest investment destination. Bilateral trade reached a record high of $91.6 billion in 2007. Singapore's cumulative actual investments reached US$33.2 billion (S$49.79 billion) as of end-2007.
Negotiations for the agreement started in August 2006, led by Singapore Deputy Prime Minister Wong Kan Seng and former PRC Vice Premier Madam Wu Yi. This followed the positive recommendation by the China-Singapore Joint Expert Group, which was established in April 2006 to study the feasibility of the FTA. The study concluded that the FTA would provide economic benefits for both sides.
Eight rounds of negotiations were held over two years in both Singapore and Beijing, concluding on Sept 3 in Beijing.
