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Following is a question by the Hon Wong Ting-kwong and a written reply by the Secretary for Commerce, Industry and Technology, Mr Joseph W P Wong, in the Legislative Council today (April 26):
Question:
It has been reported that the Free Trade Agreement (FTA) between China and the Association of South East Asian Nations (ASEAN) does not cover Hong Kong; as goods from the Mainland can be directly exported to ASEAN countries in future, the position of Hong Kong as the Mainland's entrepot and economic and trade window will be significantly undermined. Furthermore, the Mainland is also negotiating similar agreements with a number of countries and regions. In this connection, will the Government inform this Council whether:
(a) it has assessed the impact of the FTA made between the Mainland and ASEAN on Hong Kong; if it has, of the assessment results; if not, the reasons for that;
(b) it will seek to include Hong Kong in the above FTA; if it will, when it will do so; if not, the reasons for that; and
(c) the Hong Kong authorities are currently negotiating any FTAs with other countries and regions, if so, of the details; if not, the reasons for that?
Reply:
Madam President,
Since 2003, China and ASEAN have been negotiating a China-ASEAN Free Trade Area with a view to gradually reducing or eliminating tariffs and non-tariff measures for goods and liberalising trade in services and investment.
Upon the conclusion of the negotiations on trade in goods, China and ASEAN signed the Agreement on Trade in Goods of the Framework Agreement on Comprehensive Economic Cooperation (the Agreement) in November 2004 and started to implement a tariff reduction or elimination programme on July 20, 2005. Under the Agreement, the tariffs on goods between China and various ASEAN countries will be reduced or eliminated by 2012 according to the categorisation of goods and the level of development of the ASEAN countries as set out in the programme. For liberalisation of trade in services and investment, the issue is currently under negotiation between China and ASEAN and no agreement has been signed at this stage.
In respect of the question raised by Hon Wong Ting-kwong, my reply is as follows:
(a) & (b) We have been closely monitoring the figures on our trade with the Mainland and ASEAN. Since the implementation of the agreement on tariff reduction or elimination between China and ASEAN in July 2005, no significant changes have been observed in relation to Hong Kong's re-export trade with the Mainland and ASEAN. Notwithstanding this, the SAR Government has been actively examining the China-ASEAN FTA and keeping a close watch to find out its long term impact, if any, on our trade and economy. As Hong Kong is not a party to the FTA, we are liaising with the relevant authorities of the Central Government to gain a better understanding of the details and schedules of tariff reduction or elimination for different categories of goods in relation to their year of implementation as agreed by individual contracting parties. This will allow us to consider together if it is necessary to adopt corresponding measures to avoid the impacts that might be brought to Hong Kong as a result of the full implementation of the Agreement.
(c) The SAR Government has been watching closely the development of FTAs in the international community, as well as the negotiation and conclusion of FTAs by our trading partners who have close trade and economic ties with us. The SAR Government is currently not involved in any other FTA negotiations. We will continue to monitor the development of FTAs in the international community and their impacts on Hong Kong. If necessary, we will consider adopting appropriate measures, including negotiating FTAs with other economic entities, to protect and promote Hong Kong's external trade.
Ends/Wednesday, April 26, 2006
Issued at HKT 12:08
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