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Peru, China boost trade ahead of November free trade deal, President Garcia says

International Herald Tribune

Peru, China boost trade ahead of November free trade deal, President Garcia says

The Associated Press

22 March 2008

LIMA, Peru: Peru and China have agreed to boost trade and investment between their countries ahead of a free trade deal planned for November, President Alan Garcia said.

The countries, whose trade balance reached US$5.3 billion (€3.6 at year-end rates) in 2007, will in coming months sign a preliminary partnership to increase commerce more than fourfold by 2015, Garcia told local media on Friday night, after a six-day visit to China and Japan.

They plan to ink a formal trade deal during the annual Asian-Pacific Economic Cooperation forum, to be held in Peru in November, Garcia said, giving no details on tariff reductions or other preferential terms of trade.

China is Peru’s second largest commercial partner after the United States.

The preliminary agreement includes plans to boost Peruvian exports to China, including copper and wood, fivefold to US$15 billion (€9.7 billion), and Chinese exports to Peru, including high tech products, fourfold to US$12 billion (€7.8 billion) by 2015, Garcia added, without saying how those gains would be achieved.

The president predicted that Chinese investment in Peru, now largely focused on three mining projects, could soar from less than US$2 billion (€1.3 billion) today to US$10 billion (€6.5 billion) by 2015, possibly extending to 10 mining and petrochemical projects, Garcia said.

The Chinese Development Bank and about 80 Chinese businesses agreed this week to pour cash into mining, infrastructure, logging, fishing, and tourism projects, he added, without giving details.

No one was available at the Chinese Embassy in Lima on Saturday to confirm Garcia’s announcement.

Peru signed a free trade pact with the United States in December 2007, when commerce between the two nations was US$9 billion (€6.1 billion at year-end rates) for the year.

Peru and Canada also have signed a free trade deal, although both countries’ legislatures must still approve the plan.

The APEC summit, an annual forum promoting trade and investment between Pacific Rim countries, will take place in Peru on November 22-23.