China-Peru Free Trade Agreement Come into Effect on March 1

The Free Trade Agreement between China and Peru took effect on March 1. It will see the end to tariffs on up to 90 percent of goods, over several phases.

China's Ministry of Commerce believes the pact could further consolidate bilateral trade and investment. The two nations are already eyeing closer cooperation in areas including agriculture, mining, express mail, tourism as well as mutual investment.

According to the agreement, 60 percent of the traded goods between the 2 countries will be eligible for immediate duty-free entry, starting Monday. The remaining 30 percent will phase out tariffs gradually over the next 10 years.

The Ministry of Commerce says, the pact is a comprehensive deal and features a high degree of openness. It believes, the agreement will further promote bilateral economic development and friendly cooperation between the two countries.

Zhu Hong, Deputy Director, Int'l Trade & Economic Affairs, MOFCOM, said, "Sino-Peru trade volume in 2008 was around 7.4 billion US dollars. The number was down to 6.3 billion US dollars last year. But as tariffs on 90 percent of the traded goods will be eliminated over the next 10 years, bilateral trade between the 2 will definitely be boosted."

China has emerged as Peru's second-biggest trade partner. The Free Trade Agreement is China's second with a Latin American country, following an accord with Chile in 2005.

Under the agreement, the 2 counties will also further open up their service sectors to each other. The agreement will also create a convenient environment and provide special incentives to boost investment ties between the 2 sides.

At present, Peru mainly exports mineral resources to China. Figures show, that China's trade deficit with Peru was 2.4 billion US dollars in 2009.