Paraguay will negotiate a free-trade agreement with China if it receives approval from MERCOSUR, major trade bloc in South America, Paraguayan Foreign Minister Leila Rachid said on Monday in Buenos Aires.

The lack of official relations between Paraguay and China would not prevent Paraguay from proposing negotiations for a free trade agreement with the Asian country, Rachid told a press conference in Asuncion, capital of Paraguay.

However, Rachid said the proposal did not mean the two countries would establish official relations.

"We haven't started dialogue yet, because it depends on a joint decision of the four full members of the bloc," Rachid added.

MERCOSUR, or the Common Market of the South, has Argentina, Brazil, Paraguay and Uruguay as full members and Bolivia, Chile, Peru and Venezuela as associate states.

Political analysts expect that Paraguay would start commercial dialogue with China despite the lack of diplomatic relations between the two countries.

Currently, Paraguay and China have a bilateral trade of 187.6 million US dollars a year.

Source: Xinhua