China and Chile launched the fifth round of talks towards a Free Trade Agreement (FTA) Monday in Beijing, and hopes to be the last round of negotiations for a formal agreement.

"We are optimistic about closing the talks in this round," said Carlos Furche, senior official with Chilean foreign affair ministry, who headed the Chilean negotiation delegation.

Furche said this round of talks would deal with some final specific issues.

The negotiation is scheduled to last five days.

The Chilean official expected that the two countries would ink up the formal agreement during the Asian and Pacific Economic Co-operation (APEC) meeting scheduled to be held next month in South Korea.

The previous four rounds were held in China and Chile respectively. A number of issues, such as the framework of the agreement, legal issues and trade have been settled smoothly so the final phase can be reached.

Furche said when the two sides complete the FTA, it will help to rapidly improve the bilateral economic relationship and will create more jobs in both countries.

"Furthermore, the FTA will strengthen China's connection with South America and Chile's connection with Asian countries," he said.

If the FTA is set up this year, it will be the first time for China to do so with a single country. Talks began at the beginning of this year after the two countries spent about one year exploring the feasibility of the FTA.

The FTA is expected to spur bilateral trade and investment between China and Chile.

China's exports to Chile increased 22 per cent annually and its imports from Chile 42 per cent each year from 2000 to 2004. Two-way trade hit US$5.4 billion in 2004.

The trade volume is likely to experience a strong and consistent annual increase in the short term, experts said.

The copper sector is predicted to become one of the industries that will benefit most from the FTA as Chile is rich in copper and China has a large demand for the raw material.

By the end of last year, nearly 20 Chinese enterprises had combined investments of about US$24.6 million in Chile.

The Chilean side spares no effort in attracting investment from China.

Source: China Daily