China says free trade deal with Singapore under threat

China says free trade deal with Singapore under threat

Agence France-Presse, Beijing

China may delay talks with Singapore over a free trade deal following a visit to Taiwan by Singapore's Deputy Prime Minister Lee Hsien Loong, state media reported on Tuesday.

A Commerce Ministry official was quoted as saying in the China Daily that trade ties had been strained by Lee's three-day visit to Taiwan in July.

"His visit has dampened the mood to negotiate the free trade area between the two countries," said the official, whose name was not given.

The comments are the latest is a worsening diplomatic row between the normally friendly nations with Beijing releasing a number of angry statements and repeatedly warning that bilateral economic and political ties are at risk.

Beijing opposes any official visit by its diplomatic partners to Taiwan, which it regards as part of its territory waiting to be reunified by force if necessary. The two sides split at the end of a civil war in 1949.

Reports have speculated that the free trade talks could even be canceled in retaliation.

"The official response indicates a bitter pill for Singapore to swallow," the China Daily said.

Lee, the son of Singapore's founding father Lee Kwan Yew, said in a written response to the media last month that he had declined China's request not to go to Taiwan as it would have undermined the city state's independence.

He wanted to update himself on the situation in Taiwan before succeeding Prime Minister Goh Chok Tong on Aug. 12, he added.

At the same time, he reiterated Singapore's adherence to the "One China" policy and opposition to independence for Taiwan.

Singapore has been pushing the free trade talks forward with China but Beijing has been slow to respond because its own free trade area negotiations with the Association of Southeast Asian Nations (ASEAN) have not finished.

China is Singapore's second-largest trading partner, the newspaper said.