MercoPress. South Atlantic News Agency

Chile plans free trade talks with Japan and China.

Chile and Japan will begin feasibility studies with the purpose of reaching a free trade agreement, announced Wednesday Foreign Affairs minister Ignacio Walker after meeting with his Japanese counterpart Nobutaka Machimura in the framework of contacts previous to the Asia-Pacific Economic Cooperation forum which is scheduled for this weekend.

Even when the Chilean market for the all powerful Japanese economy could be small, Japanese investors believe Chile could become a significant spring board to operate in Latinamerica.

For example, the Japanese automobile industry has repeatedly complained to Tokyo authorities that they are in a disadvantageous situation regarding Korean cars lower tariffs in the Chilean market because of the free trade agreement between Chile and Korea.

Mr. Walker anticipated that when Chinese president Hu Jinatao arrives Thursday in Chile, both countries will officially announce the beginning of talks with the purpose of establishing a free trade agreement.

Another treaty which will be advanced next December until March 2005 is the three parties' agreement, Chile, Singapore and New Zealand, or T3 which is expected to be completed during the first half of next year.

This can be considered a test "free trade agreement between three countries, the first of its kind in the world and could be the foundation for a larger agreement involving the 21 economies of APEC, which also includes Chile, Mexico and Peru from Latinamerica", highlighted Mr. Walker.

In an interview with CNN Chilean President Ricardo Lagos said that the success of Chile's sustained economic growth is its exports oriented policy adding that 60% of the country's foreign sales are protected by free trade agreements signed with United States, European Union , Mexico, Canada, Korea and others in the pipeline such as China, Singapore and New Zealand.

"A balanced export performance has helped Chile face harmful foreign currencies fluctuations", added President Lagos.