China and Peru held their fifth round of talks over the upgrading of their bilateral free trade agreement (FTA) in Beijing from May 30 to Friday, the Ministry of Commerce (MOFCOM) announced in a statement on Monday.

Analysts said that the development, coming as more Latin American countries sign free trade deals with China and join the global cooperation platform known as the Belt and Road Initiative (BRI) proposed by China, showed a continued push by Latin American countries to seek trade and investment diversification against global economic headwinds.

On the basis of the consensus reached in the early stage, the two sides conducted comprehensive and in-depth consultations on topics such as cross-border services trade, investment, intellectual property rights, e-commerce, customs procedures and trade facilitation, and rules of origin, according to the MOFCOM statement.

Engaging in negotiations over the upgrading of the free trade pact will be conducive to tap the potential of the FTA benefits and bring more concrete gains to the two peoples, said the ministry.

The pact with Peru, which offers zero-tariff treatment to more than 90 percent of traded items, is China's eighth FTA. It has been in force since March 1, 2010.

Since 2010, companies in Shenzhen, South China's Guangdong Province have enjoyed tariff cuts worth 1.38 billion yuan ($194 million) by tapping these benefits, the Shenzhen customs authority said in March.

It is not known when the upgrade negotiations will conclude, but it is expected that trade and economic ties will be further improved when the upgrade is done, Jiang Shixue, professor at the Center for Latin American Studies at Shanghai University, told the Global Times.

Jiang said that as countries face economic pressure in the post-COVID world, they have a strong desire to sign deals that would contribute to and facilitate trade and investment.

Jiang said China could sign more FTAs with more Latin American countries as China's trade relationship with the continent intensifies.

China has been Peru's largest trading partner for nine consecutive years, and bilateral trade reached $34.62 billion in 2022, up 1.7 percent year-on-year, data from the Peruvian authority showed.

Bilateral trade has focused on minerals trade, such as Peru's copper exports to China, but other sectors such as agriculture have shown great potential for growth.

The talks were held as China unswervingly promotes high-level opening-up and is speeding up the establishment of a high-standard free trade network globally.

In May, China and Ecuador signed an FTA after a year of negotiations. The pact makes Ecuador China's 27th FTA partner and China's fourth FTA partner in Latin America, after Chile, Peru and Costa Rica.

Starting on May 1, some exports from Nicaragua were able to enter China tariff-free, under an Early Harvest Arrangement prior to a bilateral FTA.

On Friday, China signed a cooperation agreement with Argentina on promoting the joint construction of the BRI.

Source: Global Times