The ASEAN-China Free Trade Area ( ACFTA) to be implemented on July 1 will significantly benefit the intra-regional trade and economy and establish a milestone for the future of ASEAN-China economic ties, ASEAN Secretary General said here Thursday.

The establishment of ACFTA will create an economic region with 1.7 billion consumers, a regional GDP of about 2 trillion US dollars and total annual trade volume estimated at 1.23 trillion US dollars, Secretary General Ong Keng Yong said in a statement exclusively for Xinhua.

The removal of trade barriers between the Association of Southeast Asian Nations (ASEAN) and China will lower costs, increase trade volume and beef up economic efficiency, he said.

The ACFTA will create a sense of community among ASEAN member countries and China, provide another important mechanism for supporting economic stability in East Asia and allow both ASEAN and China to have a larger voice in international trade affairs on issues of common interests, he said.

The significant increase in the ASEAN-China bilateral trade is expected to continue to flourish under the ACFTA, he added.

"We are confident that the bilateral trade will reach 100 billion US dollars before the end of 2005, a target set by Chinese Premier Wen Jiabao at the ASEAN-China Summit in 2003 in Bali," the secretary general said, adding that the growth will have a spillover effect into other areas of ASEAN-China relations.

All ASEAN member countries are expected benefit from the ACFTA, he said, stressing that the level of benefit will depend on the ability and readiness of the private sector of in each country to exploit opportunities within ACFTA.

The ASEAN has fostered an environment conducive for its member countries to do business with China and now it is up to them to develop appropriate business strategy to benefit from the ACFTA, said Yong.

In the future, the ASEAN will monitor the implementation of the ACFTA, he said.

China has extended its goodwill and friendship and the ASEAN has responded positively to these overtures, he said, emphasizing the necessity to educate the business sector about the opportunities to be offered by the ACFTA.

Under the ACFTA, the ASEAN and China will start making some 7, 000 kinds of commodities exempt from tax on July 1 and manage to give duty-free status to all commodities in bilateral trade by 2010.

Source: Xinhua