The free trade agreement between China and Iceland

In the presence of Li Keqiang, the Premier of China, and Johanna Sigurdardottir, the Prime Minister of Iceland, Mr. GaoHucheng, Minister of Commerce of the People’s Republic of China, and Mr. ÖssurSkarphéðinsson, Minister for Foreign Affairs and External Trade of Iceland, signed, on behalf of their own government, the Free Trade Agreement between the Government of the People’s Republic of China and the Government of Iceland at the Great Hall of the People in Beijing on April 15. The Agreement is the first FTA China signed with European country, which covers trade in goods and services, and investment.

According to the FTA, Iceland will implement zero tariffs from the date the FTA coming into force on all industrial products and fishery products imported from China which accounting for 99.77% of the total China’s exports to Iceland. At the same time, China will implement zero tariffs on goods under 7,380 tariff numbers imported from Iceland. These products accounted for 81.56% of China’s total imports from Iceland, including, abundant aquatic products. China and Iceland realize zero tariffs after the completion of FTA. At the completion of FTA, zero tariff shall apply to goods of 96% if by tariff number, or 100% if by trade volume.

Besides, China and Iceland also made more commitments than required by the WTO on trade in services, and sets specific requirements for investment, movement of natural persons, sanitary and phytosanitary measures, technical barriers to trade, rules of origin, customs procedures, competition policies, and intellectual property rights.

The Free Trade Agreement between the Government of the People’s Republic of China and the Government of Iceland started in December, 2006 and four rounds of negotiations were conducted. Due to Icelandic application to join EU, negotiations aborted in 2009. In April 2012, heads from China and Iceland decided to restart the China-Iceland FTA negotiations. After two rounds of negotiations, the two countries ended substantive negotiations in January 2013, and agreed on terms of the Agreement.

Source: Ministry of Commerce Website; http://english.mofcom.gov.cn/article/newsrelease/significantnews/?2

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