China-Singapore free trade deal a reality - FTA takes effect on January 1, 2009

This is China’s first bilateral trade agreement with another Asian nation, according to this article from ICTSD:

Under the agreement, tariffs will be eliminated on more than 85 percent of Singapore’s exports to China upon the FTA’s entry into force, with an additional 10 percent of goods made duty-free by the next year. According to a Chinese statement, in total, a zero-tariff policy on 97.1 percent of Singaporean imported goods will be realised before the start of 2012. Although 260 specific goods are to be excluded, key products to be covered by the agreement include petrochemicals, processed foods and electrical products.

In return, Singapore will eliminate all tariffs on Chinese exports when agreement comes into force.

Talks for the deal began in October 2006 following a China-Singapore Joint Expert Group study on the feasibility of an FTA between the two countries. Following eight rounds of negotiations, the talks concluded on 3 September this year.

According to the Singaporean Ministry of Trade and Industry, trade between the two countries reached US$ 62 billion in 2007. China is Singapore’s third-largest trade partner and largest investment destination, while Singapore is China’s eighth-largest trading partner.

Hat tip to World Trade Magazine.