Agriculture Reference
In-Depth Information
13
The economic impact of the
ASEAN-China Free Trade Area
A computatonal analyss wth
specal emphass on agrculture
Jun Yang and Chunlai Chen
Trade between Chna and the Assocaton of South-East Asan Natons
(ASEAN) has ncreased very rapdly n the past decade. Total trade (mports
plus exports) between China and ASEAN expanded 6.7 times, from US$19.3
billion in 1996 to US$105.1 billion in 2005—an annual growth rate of 21 per
cent. Currently, China is ASEAN's third largest trading partner, and ASEAN
s Chna's fourth largest tradng partner. As the growth rate of Chna's
mports from ASEAN s hgher than that of ts exports to the regonal
group, China's trade status with ASEAN has changed from a trade surplus
to a trade deficit, and the deficit has been rising in recent years. In 2005,
China's trade deficit with ASEAN reached US$19.8 billion.
The tradng relatonshp between Chna and ASEAN s expected to
become closer because of the establishment of the ASEAN-China Free
Trade Agreement (ACFTA). The Framework Agreement on ASEAN-China
Comprehensive Economic Cooperation was signed in 2002, and represented
a milestone in cooperation between the two economies. The ACFTA is
scheduled to enter nto force n 2010.
1
Wth a vew to acceleratng the
implementation of the agreement, the parties agreed to implement an
Early Harvest Program (EHP) with a package of agricultural and industrial
products. The EHP committed the participating countries to the elimination
of tarffs on these products between 2004 and 2006.
2
