Bilateral trade and economic ties between China and the Association of Southeast Asian Nations, or ASEAN, has entered a new phase, with the establishment of the strategic partnership between the two, Chinese Vice Premier Zeng Peiyan said on Sunday.

Chinese Vice Premier Zeng Peiyan met with Cambodian Prime Minister Hun Sen from the Association of Southeast Asian Nations (ASEAN) Saturday, October 27, 2007. (Xinhua photo)

Trade between China and the ASEAN surpassed 160 billion U.S. dollars last year, 1.9 times the figure for 2002, which made the two the 4th largest trading partners for each other, said Zeng at the opening of the China-ASEAN Business and Investment Summit in the southern China city of Nanning.

"Bilateral trade has kept a rapid growth momentum since the beginning of this year and total trade is expected to reach 190 billion U.S. dollars," said Zeng, adding, "The preset target of 200 billion by 2010 is very likely to be fulfilled in 2008."

With two-way investment continuing to grow, ASEAN countries had invested a total of 41.9 billion U.S. dollars in China by the end of 2006. Meanwhile, said Zeng, more and more Chinese enterprises have made ASEAN countries their major destinations of investment and ASEAN enterprises their major partners for construction and technological cooperation.

Since the Trade in Goods Agreement between China and the ASEAN took effect in July 2005, China's average tariff on ASEAN exports has been reduced to 5.8 percent. Tariff on Chinese exports to ASEAN countries has also been cut, Zeng noted.

China and the ASEAN also witnessed progress in the negotiation for inking an investment agreement after the bilateral service trade pact came into effect in July this year.

All this signals the two sides have made "a firm step" to the establishment of the China-ASEAN Free Trade Area, the vice premier said.

The two sides have also witnessed progress in subregional cooperation and are intensifying cooperation along the Beibu Gulf Rim, following the successful mode of the Greater Mekong Subregional cooperation, said Zeng.

The Beibu Gulf economic belt is an area surrounded by south China's Guangdong and Hainan provinces and Guangxi, as well as the six ASEAN members of Singapore, Malaysia, Indonesia, the Philippines, Vietnam and Brunei.

The 10-nation ASEAN also groups Thailand, Myanmar, Cambodia and Laos. China aims to establish free trade zone with Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand by 2010. Free trade zones with Vietnam, Laos, Cambodia and Myanmar are expected to be in place by 2015.