China, Singapore strengthen political, commercial ties

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Free Trade Agreement:
China, Singapore strengthen political, commercial ties
China signed a free-trade agreement with Singapore on Thursday, its seventh such pact widely seen as aimed at building political as well as commercial ties with other countries, reported AFP.

Chinese Premier Wen Jiabao and Singaporean Prime Minister Lee Hsien Loong witnessed the signing ceremony in Beijing, with Singapore hailing the deal as a an economic boon for the tiny Southeast Asian city-state.

"China is one of the largest and fastest growing markets in the world," the Singaporean government said in a statement.

"The agreement will enhance Singapore companies' access to the vast Chinese market and further boost our excellent bilateral trade and investment relations."

Singapore's trade with China climbed to a record high of S$91.6 billion ($62 billion) last year and Thursday's agreement, due to come into force at the start of 2009, was sure to see that rise further.

China is already Singapore's third largest trading partner and biggest investment destination. Singapore is China's eighth-largest trading partner.

Under the agreement, Singapore will abolish tariffs on all products imported from China from the beginning of 2009, the Chinese commerce ministry said in a statement.

In return, China will reduce the tariff to zero on 97.1 percent of goods imported from Singapore by January 1, 2012, it said.

The Singaporean government said all goods from the city-state, except for about 260 products, would enjoy tariff-free access to China by 2010.

These make up about 95 percent of Singapore's exports to China, with petrochemicals, processed foods and electrical products among the key items.