FTA to promote world trade development

Nowadays, the economic globalization and regional economic cooperation have become two major trends of the development of world economy and taking advantage of preferential economic and trade policies to seek a larger economic growth has become an important choice of the world's most countries.

The implementation of the free trade area (FTA) is a significant strategic deployment in China's policy of opening to the outside world. Under the situation of uncertain European debt crisis and weak resurgence of the world economy, it is urgent and necessary for China to further strengthen economic ties with Japan and South Korea.

The ministers of economic and trade departments of China, Japan and South Korea have recently announced the formal launch of trilateral FTA talks. The establishment of the trilateral FTA plays an important role in achieving complementary advantages and self-improvement, exploiting new opportunities for development, pushing forward the economic integration in East Asian region, jointly resisting the risks brought by the economic globalization and increasing Asian countries' status in the international trade and economic affairs.

China, Japan and South Korea are close neighbors and have the strongest economic strength in East Asia. Their total economic aggregate accounted for about 70 percent of Asian economy.

In 2011, the total volume of foreign trade of the three countries accounted for about 20 percent of the global trade volume, the trilateral trade volume reached less than 20 percent and the trilateral investment volume accounted for 6 percent of their gross outward aggregate investments.

The author is former vice minister of the Ministry of Commerce, vice chairman and secretary general of the China Center for International Exchange

The level of cooperation between China, Japan and South Korea is far lower than the regional cooperation of North America and European Union and even lower than the Association of Southeast Asian Nations (ASEAN).

Therefore, the economic and trade cooperation between the three countries still has great development potential.

After completion of the trilateral FTA, a large market with a population of more than 1.5 billion will take shape. It will bring a win-win situation for the three countries, enlarging the scale of the trilateral trade and cooperation, promoting the economic development and improving the overall competitiveness.

Japan and South Korea have an obvious competitive advantage in resources and technology-intensive industry while China has an advantage in resources and labor-intensive industry.

The establishment of trilateral FTA will effectively reduce the trade and investment barriers, lower the cost, strengthen cooperation of industrial investment, give full play to the role of the integrated market and further improve the trilateral trade, the scale of production and economic benefits.

Qingdao has unique geographical advantages in economic and trade cooperation with Japan and South Korea, both of which has set up Consulate General in Qingdao, rendering Qingdao the conditions to walk in the forefront in the strategic implementation of China-Japan-South Korea Free Trade Area and to realize leap-forward development of a century.

Qingdao should seize the opportunities of the development of Shandong Peninsula Blue Economic Zone, rely on the construction of the Free Trade Area, accelerate industrial restructuring and transformation, strengthen the cooperation with Japan and South Korea in the fields of marine science and technology, new energy, energy saving and environmental protection, bio-pharmaceutical and other, and create new competitive advantages in urban industry.

Qingdao should not only strengthen cargo trade relations with Japan and South Korea but also enhance the all-around and in-depth cooperation with them in service trade, two-way investment, technical cooperation, and personnel exchanges, to rely on Japan and South Korea's advanced technology and experience, accelerate the establishment of a series of new norms to integrate international standards including quality systems, management systems, property rights protection systems, and environmental standards, constantly improve the urban modernization level, to play a more important exemplary role in the process of economic integration in East Asia.