Chile and Australia agreed on Friday to start bilateral free trade talks, according to a statement issued by Chile's Foreign Ministry.

The two sides reached the agreement during a meeting between visiting Chilean Foreign Minister Alejandro Foxley and his Australian counterpart Alexander Downer in Adelaide, Australia.

"This is a key free trade agreement for us," Foxley said in the statement.

"As a very developed country, Australia has indisputable access to Asian nations, and we can obtain great benefits by partnering with them," he added.

The new trade agreement would open Chile up for Australian investment and increase job opportunities in the south American country.

"We are not going to compete with Australia, but collaborate to access the gigantic markets they have already tapped," he said.

Two-way trade between the two countries reached 260 million U.S. dollars in 2005, with Australia exporting 165 million dollars worth of goods to Chile and Chile, 95 million dollars to Australia.

Australia has tripled its per capita income in the last 25 years by diversifying its manufacturing industry and boosting trade with Asian and Western countries.

"With such partnerships, if we take the right steps, we will soon be close to the per capita income levels seen in Australia and New Zealand," Foxley said.

Source: Xinhua