China, Japan, South Korea set free-trade talks

Beijing, China (4E) – The leaders of China, Japan and South Korea on Sunday agreed to start negotiations for a free trade agreement later this year during their Fifth Trilateral Summit meeting in the Chinese capital.

Chinese Premier Wen Jiabao, Japanese Prime Minister Yoshihiko Noda and South Korean President Lee Myung-bak made the announcement in a joint press conference after the meeting.

Bilateral talks on the FTA between China and South Korea started early this month and are expected to last two years, according to China’s Minister of Commerce Chen Deming.

The three-way FTA is projected to raise the gross domestic product (GDP) of China by up to 2.9 percent, Japan by 0.5 percent, and South Korea by 3.1 percent. The three major traders account for 90 percent of the East Asian GDP and 20 percent of the world’s GDP, according to a Chinese Foreign Ministry white paper. They also account for 70 percent of East Asia’s trade and 20 percent of the world’s trade.

Trade between the three countries amounted to $690 billion in 2011.

China is the biggest trading partner of Japan and South Korea. Japan and South Korea is China’s fourth and sixth biggest trading partner, respectively.

The three countries also agreed to expand the use of their currencies, promote the development of Asian bond markets and promote recycling economy.

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