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China-ASEAN FTA adds new vitality into Sino-Philippine economic and trade cooperation: official

Source:   Time:

MANILA, Jan. 16 (Xinhua) -- China-Association of Southeast Asian Nations (ASEAN) Free Trade Agreement (CAFTA) has added new vitality into Sino-Philippine economic and trade cooperation, a Chinese official said.

The CAFTA, the biggest among developing countries, has significantly promoted the economic and trade ties between China and ASEAN countries -- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam since its implementation about one year ago, statistics showed.

According to the figures released by the General Administration of Customs of China, from January to November in 2010, bilateral trade between China and ASEAN totaled 263.01 billion U.S. dollars, achieving an year-on-year increase of 40.6 percent. During the period, China exported commodities with a total value of 124.45 billion U.S. dollars to ASEAN, securing an increase of 33.6 percent, while ASEAN's export to China amounted to 138.56 billion U.S. dollars, increasing by 47.5 percent.

"It was right under this circumstance that trade between China and the Philippines in the same period totaled 25. 23 billion U.S. dollars, achieving a year-on-year increase of 38.8 percent, with China exporting goods worth 10.51 billion U.S. dollars to the Philippines while importing from the Southeast Asian country commodities worth 14.72 billion U.S. dollars, which helped the Philippines enjoy a surplus of 4.22 billion U.S. dollars, " Wu Zhengping, Economic and Commercial Counsellor of the Chinese embassy in the Philippines, told Xinhua in a recent exclusive interview.

Currently, China is the third largest trade partner of the Philippines, while the Philippines ranks the sixth among ASEAN countries in terms of trade ties with China, said Wu.

From January to September in 2010, Wu said, China's newly increased non-financial direct investment to the Philippines totaled 72.94 million U.S. dollars, achieving a year-on-year increase of 315.9 percent, which is second only to Malaysia in the ASEAN region.

Meanwhile, China introduced from the Philippines contracted foreign capital amounting to 63.35 million U.S. dollars, which secured a year-on-year increase of 177.4 percent -- the highest speed in the region, Wu added.

"It's fair to say the Philippines is becoming one of the main destinations for Chinese companies to make overseas investment, and the Southeast Asian country has very big potential," Wu said, adding Chinese investment in the Philippines mainly focuses on manufacturing and mining, while Philippine investment in China prefers retailing, catering and real estate industries.

Since the free trade zone was formally established on Jan. 1, 2010, China's average tariff on ASEAN commodities has plummeted from 9.8 percent to 0.1 percent, while Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand have slashed their average tariff on Chinese commodities from 12.8 percent to 0.6 percent. The other four ASEAN members -- Cambodia, Laos, Myanmar and Vietnam are expected to realize zero tariff on 90 percent of Chinese commodities by 2015.

"China and ASEAN have by and large realized free trade, which will surely help level up the flowing efficiency of production factors such as fund, technology and talented people. In the past year, trade and investment growth sped up and economic integration deepened between China and the Philippines, benefiting companies and peoples of both countries," said Wu.

According to an Asian Development Bank (ADB) study conducted early 2010, many responding Philippine companies said they deem the CAFTA as one of the most important trade agreements for the Philippines.

However, the study discovered that only around 20 percent of Philippine companies were availing of free trade agreements' zero tariff benefits -- lower than the average 28 percent in East Asia.

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