Hong Kong and Macao will soon start negotiations on a free trade agreement, namely the Hong Kong and Macao Closer Economic Partnership Arrangement (HK-Macao CEPA), the Hong Kong Special Administrative Region government said on its news website on Friday [9 October 2015]. The new arrangement will cover elements including commitment to bind tariff at zero, minimizing non-tariff barriers, avoiding imposing trade remedies, customs facilitation procedures, liberalization and facilitation of trade in services, and legal and institutional arrangements…Full Article: ECNS.cn Oct 2015
- Both Hong Kong and Macao have separate CEPA agreements with mainland China. Once a CEPA agreement is concluded between Hong Kong and Macao, all three territories will have a common trade platform.
- In 2001 there was concern that China’s accession to the World Trade Organization (WTO) would undercut Hong Kong’s lucrative trade relations with the mainland. The worry was that WTO member states would be able to out-compete Hong Kong for the Chinese import market once China agreed to lower its import tariff regime in line with WTO membership requirements. In order to shore up Hong Kong’s status as a trade hub, China and Hong Kong signed the Closer Economic Partnership Arrangement (CEPA) in 2003, an agreement that laid the groundwork for a zero-percent import tariff rate between the two systems. CEPA guaranteed that commercial trade between Hong Kong and the mainland took precedence over any foreign agreements that could potentially disrupt the one country, two systems principle.