The Chinese mainland and Hong Kong Special Administrative Region (SAR) signed up to the third phase of the Mainland & Hong Kong Closer Economic Partnership Arrangement, known as CEPA III, yesterday.

Under the new arrangement, the mainland has agreed to give all products of Hong Kong origin tariff-free status from January 1 upon local manufacturers' application and CEPA rules of origin being agreed and met.

There are also 23 liberalization measures spread over ten areas: legal, accounting, audiovisual, construction, distribution, banking, securities, tourism, transport and individually owned stores.

Textiles and clothing products under Hong Kong's Outward Processing Arrangement have already been exempted from the mainland's export duty regime.

The SAR's Financial Secretary Henry Tang and the central government's Vice Minister of Commerce Liao Xiaoqi signed the legal text after a high level meeting of the CEPA Joint Steering Committee.

Tang said the move would offer new business opportunities in the mainland for Hong Kong and enhance its attractiveness to overseas investors. It would also help sustain Hong Kong's broad-based economic recovery and spawn new jobs.

According to Tang, 29,000 new jobs have been created since implementation of CEPA I.

Tang said the scheme was an open and developing platform, and he anticipated its continued development.

Liao said mainland authorities attached great importance to Hong Kong's economic development, adding that all measures that could help the SAR and maintain its prosperity and stability would be carefully considered.

(Xinhua News Agency October 19, 2005)