China, Group of Southeast Asian Nations Seal Free-Trade Pact.

Byline: Achara Ashayagachat

Nov. 7--Leaders of Asean and China yesterday agreed to establish a free-trade area within 10 years and to give lesser developed Asean economies special treatment and flexibility in achieving the goal.

Senior economic officials could start preliminary talks on the issue as early as next month, Asean secretariat sources said.

"The path will be like the Asean Free Trade Area, with poorer economies to be given a grace period before starting their tariff cuts for Chinese goods," a source said.

An official statement said an "early harvest" list of products and services would be determined by mutual consultation. China had already agreed to give preferential tariffs to certain goods from Cambodia, Laos, and Burma, the least developed members of Asean.

China's vice-foreign minister Wang Yi hailed the agreement as an important expression of political will.

China initiated the idea of setting up a free trade area with Asean which would open up a combined market of 1.7 billion people, with an estimated gross domestic product of US$2 trillion and two-way trade of $1.23 trillion.