Hong Kong expects to finalise Asean free trade agreement by 2016

Hong Kong expects to have a free trade agreement with Asean economies in place by 2016, government officials said yesterday as they sketched out a timeline for progress on trade talks that began in July.

Gregory So Kam-leung, secretary for commerce and economic development, said that he expects all of the six rounds of negotiations for the free trade agreements between Hong Kong and Asean countries to be completed by 2016. The first round of talks was held in July, So added.

Fearing diversion of trade from Hong Kong since the mainland joined the trade pact as "10 plus one" in 2010, Hong Kong manufacturers have been urging the city government to join the Asean-China free trade network to maintain the city's position as a transit hub for mainland external trade.

"China exports can go directly to the Asean countries with tariffs reduced or eliminated, without going through Hong Kong. Hong Kong's position is being weakened. We need the '10 plus two'," said Stanley Lau, chairman of the Federation of Hong Kong Industries.

Jonathan Choi, honorary president of the Chinese General Chamber of Commerce, said negotiations with the Asean countries have not been easy as Hong Kong is already a free port and does not impose tariffs on imports. That means there isn't much Hong Kong can offer as preferential treatment for Asean countries, which reduces the city's bargaining power.

"We have already given [the preferential offer]," said Choi, referring to Hong Kong's zero-tariff arrangement. "We are now just asking to join [the trade pact]."