By Vo Mai Nguyen Phuong, Han Qiao

    HANOI, Dec. 31 (Xinhua) — The establishment of the Free Trade Area (FTA) between China and ten member states of the Association of Southeast Asian Nations (ASEAN) makes Vietnam’s trade with China easier and better, said Doan Duy Khuong, Vice Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) here on Thursday.

    In an exclusive interview with Xinhua here on Thursday, Khuong said that Vietnam, as an ASEAN member, is expecting both opportunities and challenges brought about by the FTA.

    Scheduled to take effect as of Jan. 1, 2010, the ASEAN-China FTA includes China and ten Southeast Asian countries namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

    The FTA is expected to become world’s third largest free trade area with a combined population of 1.9 billion and a combined gross domestic product (GDP) close to 6 trillion U.S. dollars.

    Khuong said that FTA means tariff reduction and simplification of administrative procedures such as customs and investment licensing. Therefore, Vietnamese products will have better access to the Chinese market and vice versa.

    For Vietnam, China has become a leading trade partner as statistic figures show, according to Khuong. In 2009, bilateral trade between the two countries is estimated at roughly 20 billion U.S. dollars. Trading with China has been of great significance to Vietnam so far, said Khuong.

    Khuong said that under the FTA scheme, tariff will be lowered, therefore helping reducing the illegal trading along the border between China and Vietnam.

    The FTA will also make cooperation among Vietnam, China and other ASEAN members in production of a particular product become easier, said Khuong.

    Countries within the FTA can produce different parts of a product based on their strength so that consumers could enjoy a higher-quality but lower-cost finished product. The cooperation in the manufacturing process would not only help businessmen tap the markets of China and ASEAN countries, but also pave the way for them to enter other markets such as the European Union and Africa.

    However, FTA brings tougher competition for Vietnamese companies as there are similarities in manufacturing products between Vietnam and the other countries within the FTA.

    Level of competition would be different in various sectors, according to Khuong.

    Though, competition would do good to both Vietnamese manufacturers and consumers, Khuong said. Competition makes companies have to improve themselves to produce better products and therefore consumers benefit from that.

    Next year, Vietnam will hold the ASEAN Chairmanship, Khuong said. The country will make efforts to improve the connection between ASEAN and China and bring cooperation to a new height. Therefore, it would promote the implementation of the ASEAN-China Free Trade Area.

Special Report:  China-ASEAN FTA 

    HONG KONG, Dec. 31 (Xinhua) — The total deposits with authorized institutions in Hong Kong rose 0.5 percent in November, with the foreign currency deposits expanding 1 percent while the Hong Kong-dollar deposits being little changed, the Monetary Authority announced Thursday.

    Total loans and advances expanded 1.5 percent, with the part for use in Hong Kong climbed 1.2 percent while the part for use outside Hong Kong grew 2.7 percent.

    As Hong Kong-dollar loans grew while deposits were stable, the Hong Kong-dollar loan-to-deposit ratio rebounded to 69.9 percent at the end of November from 69.1 percent at the end of October.

    HONG KONG, Dec. 31 (Xinhua — The Financial Services and the Treasury Bureau of the HKSAR government recorded a surplus of 17.9 billion HKD in the government’s financial results for November, reducing the deficit for the eight months ending Nov. 30 to 38.9 billion.

    Expenditure in November was 20.6 billion HKD while revenue was 38.5 billion. Expenditure for the eight-month period was 182.2 billion HKD while revenue was 143.3 billion.

    The bureau said the improved financial results were mainly due to profits tax collection.

    According to the Bureau, Hong Kong’s fiscal reserves stood at 455.5 billion HKD on Nov. 30.

    HONG KONG, Dec. 31 (Xinhua) — The Hang Seng China Enterprises Index rose 263.36 points, or 2.10 percent, to close at 12,794.13 in the shortened session on Thursday, the last trading day of 2009.

    The H-shares index, initiated in August 1994 and readjusted on Sept. 7, 2009, tracks the overall performance of 44 major Chinese mainland state-owned enterprises listed on the Hong Kong Stock Exchange.

    The Hang Seng China H-Financials Index gained 2.40 percent.

    The H-Financials Index, initiated on Nov. 27, 2006, readjusted on Sept. 10, 2007, tracks the performance of nine major banks and insurers of the Chinese mainland.

    The Hang Seng Mainland Composite Index was up 90.08 points, or 2.25 percent, to close at 4,089.71.

    Introduced on Oct. 3, 2001 with the latest readjustment effective on March 9, 2009, the Hang Seng Mainland Composite Index gauges the performance of 132 Hong Kong-listed companies with principal places of business in Hong Kong and the Chinese mainland.

    The Hang Seng China-Affiliated Corporations Index added 2.59 percent at 4,059.89.

    The index tracks the performance of 34 locally listed companies with a significant equity interest held by entities in the Chinese mainland.

Special Report:  Global Financial Crisis