Hong Kong General Chamber of Commerce - CEPA

CEPA

In HKGCC's report “China’s Entry into the WTO and its Impact on Hong Kong Business”, released on 18 January 2000, one of the key recommendations was to explore the possibility of setting up a regional trade agreement (RTA), also sometimes called a “free trade agreement”, as a concrete means to enhance further integration of trade and economic relations between Hong Kong and Mainland China. After China’s accession to the WTO in 2001, HKGCC once again presented the idea to Tung Chee-hwa, the then HKSAR Chief Executive. The idea struck a chord with Tung who then put forward the RTA concept to the Central Government. On 20 December 2001, President Jiang Zemin told Tung that the Central Government formally agreed to the suggestion, and consultation would begin immediately.

In January 2002, discussions between the HKSAR and the Central governments formally began, and a regional trade agreement was hammered out and formally named “Mainland/Hong Kong Closer Economic Partnership Arrangement” or CEPA. HKGCC then submitted a paper entitled “Topwards a Regional Trade Agreement between China and HKSAR” to Antony Leung on 21 January 2002, put forward seven principles to guide the discussions on the RTA, emphasizing that CEPA must be compliant with WTO principles.

Despite being put on hold for months due to the outbreak of SARS during March – June 2003, negotiations resumed and CEPA's text was finally concluded by the Central and HKSAR government negotiators, and signed on 29 June 2003.