THURSDAY, NOVEMBER 29, 2001
China mulls free trade zone proposed by Hong Kong
HONG KONG: China's top trade negotiator Long Yongtu said on Wednesday Beijing was considering a proposal by Hong Kong Chief Executive Tung chee-hwa for a free trade zone to be set up between the territory and the mainland.
Long told reporters on the sidelines of the Pacific Economic Cooperation Council conference in Hong Kong that Beijing was studying a free trade zone consistent with the rules of the World Trade Organisation (WTO), which China will soon enter.
Tung's proposal represented the latest in a recent string of requests from the territory for preferential treatment and economic assistance from the central Chinese government.
"Tung Chee-hwa has already made this proposal to the central government," Long said, adding he was "very open-minded" about it.
"We are studying a new model that is consistent with WTO rules and positive for the strengthening of economic relationship between Hong Kong and the mainland," he said.
He said the proposed free trade zone should also cover Macau. But he ruled out the possibility of the zone covering Taiwan which still bans direct shipping, trade and postal services with mainland China.
"The proposal for establishing the free trade zone would be positive for closer economic ties among Hong Kong, Macau and mainland China," he said.
Long did not elaborate on the free trade zone model being considered.
A free trade zone usually refers to an extra-territorial area within a country designated by the government and having manufacturing facilities free of government hindrance, customs duties or currency restrictions.
Earlier this month, China and 10 Southeast Asian nations agreed to create a free trade area within 10 years.
Hong Kong, a former British colony, reverted to China in 1997 as a highly autonomous city. Now, with the local economy on the verge of a recession, Hong Kong's government and industry leaders have recently been asking for favours from mainland China.
These include allowing more mainland tourists into Hong Kong, allowing mainland investors to invest in the local stock market, preferential treatment for Hong Kong companies, and allowing the territory to host one or two Olympic events in 2008.
Beijing recently announced preferential treatment for Hong Kong investors in the Chinese capital.
The former Portuguese-ruled territory of Macau returned to the Chinese fold in 1999 as a highly autonomous city, like Hong Kong.
Taiwan and mainland China regard each other as archrivals since the Nationalists lost the Chinese civil war to the Communists in 1949. ( REUTERS ) Copyright © 2001 Times Internet Limited. All rights reserved.