China, Singapore sign free trade accord amid global turmoil

BEIJING (Reuters) - China and Singapore have signed a free trade pact covering goods, services and labour that China's commerce ministry said will help the two countries cushion the impact of the global financial crisis.

The deal, agreed to last month after two years of negotiations, was signed during Singaporean Prime Minister Lee Hsien Loong's visit to Beijing for the Asia Europe Meeting (ASEM) Summit.

China agreed to eliminate tariffs for 97.1 percent of goods from Singapore starting in 2012, while Singapore will scrap taxes on all goods imported from China from next year, the ministry said in a statement on its website (www.mofcom.gov.cn).

"The pact, signed amid global efforts to cope with the financial turbulence, will be helpful to stabilise and increase economic and trade growth in the two countries," it said.

China's economic growth fell to 9 percent in the third quarter from 10.1 percent in the previous three months, while Singapore's economy shrank an annualised, seasonally adjusted 6.3 percent in the July-September period, after declining 5.7 percent in the preceding quarter.

The new agreement allows China to open wholly owned hospitals as well as schools and training centres teaching Chinese language and medicine.

Investors from Singapore can own up to 70 percent of individual hospitals in China, the ministry added.

(Reporting by Langi Chiang; Editing by Ken Wills)