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Economic zone to lure Chinese funds to Costa Rica

By Bao Chang | China Daily | Updated: 2013-02-27 07:33

China and Costa Rica are planning to establish a special economic zone in the Central American nation.

The move is aimed at bolstering the economy of Costa Rica, China's largest trading partner and investing destination in Central America. China is also the country's second-largest trading partner.

"We are discussing with the China Development Bank the idea of establishing a special economic zone in Costa Rica, and we expect to conclude the study on the project this year," Costa Rica's Foreign Trade Minister, Anabel Gonzlez, told China Daily.

More details about the project, including location, investment source and volume, will be settled after the study is completed.

Through cooperation with China on setting up the zone, Costa Rica expects to attract more Chinese investment in industries including electronics, tourism and financial services, and to take advantage of Chinese technology, Gonzlez said.

"There are many Costa Rican companies that could benefit from this, because we are looking to bring more investment to the country," Gonzlez said.

"As China's biggest investing destination in Central America, Costa Rica can act as an exporting platform for Chinese companies to sell goods to other markets."

Trade and investment between the two countries has been boosted since a free-trade agreement came into effect 18 months ago.

Customs data show that bilateral trade stood at $4.73 billion in 2011, an increase of 24.6 percent from a year earlier.

"Trade between the two countries has been growing significantly and I think the FTA with China is a very valuable instrument," Gonzlez said.

Zhou Shijian, a senior trade expert at Tsinghua University, said Costa Rica is a good channel for China to boost trade with Latin American countries.

In recent years, China has accelerated work on establishing special economic zones with its major trading partners.

In 2011, China and the Democratic People's Republic of Korea established the Rason Economic and Trade Zone in the DPRK port of Rason on the country's east coast near Jilin province, and the Hwanggumpyong and Wihwa Islands Economic Zone, in the west near Liaoning province, aiming to boost bilateral trade and investment cooperation.

A Chinese trade and development zone was established on the Indian Ocean island of Mauritius in 2008.

The $820 million Jinfei Economic and Trade Cooperation Zone is China's first overseas special economic zone and the largest injection of foreign cash into Mauritius.

China is also discussing the establishment of economic zones with Russia and Uzbekistan and economic technical development areas in those countries.

Zhou said: "Apart from goods exports, China's capital exports and use of foreign exchange reserves will play an important role in the worldwide economy and help drive economic growth of both developing and developed countries."

Contact the writer at baochang@chinadaily.com.cn

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