China offers more incentives to Asean investors in planned trade pact

China is ready to offer more preferential treatment to investors from Asean countries as part of a bilateral free-trade agreement under negotiation, Premier Li Keqiang said.

Li also pledged more financial support to the 10-member Association of Southeast Asian Nations, including US$20 billion loans, 3 billion yuan (HK$3.8 billion) to fight poverty and other initiatives to boost infrastructure and economic development.

Li repeated the promises at several meetings during the Asean summit in Myanmar that followed the Asia Pacific Economic Cooperation summit in Beijing. The 21 Apec economies agreed to move towards a new free-trade zone, backed by Beijing, which is seen as a rival to the US-led Trans-Pacific Partnership (TPP), which excludes China.

Li continued to push forward trade initiatives at the Asean summit yesterday, calling for an early wrap-up of negotiations for an expanded free-trade agreement between China and Asean.

In return, China was willing to begin the negotiations by taking a so-called negative-list approach, which would lower the threshold for Asean businesses to set up in China. Sectors previously closed to foreign investors would be open to Asean countries - unless they were specifically mentioned in the list. The Shanghai free-trade zone established last year is based on a similar concept.

Li said 30 million yuan would be set aside to support economic and technological cooperation between China and Asean. China would also work with the bloc to seal the Regional Comprehensive Economic Partnership, a proposed free-trade agreement covering Asean and six other countries, by the end of next year.

Beijing would also support negotiations for a free-trade deal between Hong Kong and Asean, Li added.