China and Pakistan will start to cut or scrap tariffs on all products from July 1 to boost bilateral trade, Wang Xinpei, spokesman of the Ministry of Commerce, has said.

The two-phase step is in accordance with a free trade agreement (FTA) signed by the two countries last November, which aimed to triple the trade volume to 15 billion dollars in five years.

Under the agreement, both sides will, during Phase I, slash tariffs on 85 percent of the products by different ranges in five years after the agreement is put into force, and eliminate tariffs on 36 percent of the products in three years.

During this phase, China will largely reduce tariffs on livestock, aquatic products, vegetables, mineral products and textiles, while Pakistan will mainly reduce tariffs on beef and mutton, chemicals and machinery products.

In phase II, which starts from the sixth year after the agreement comes into force, both sides will further reduce tariffs on the products based on the agreement implementation. The aim is to scrap tariffs on up to 90 percent of products within a reasonable period with mutual concerns being taken into account.

The agreement also covers investments, including investment promotion and protection, treatment of investments, expropriation, compensation for damages and losses and dispute settlement.

China and Pakistan trade volume reached 5.3 billion U.S. dollars in 2006, up 23 percent over the previous year. Bilateral trade volume has grown by nearly 20 percent annually over the past ten years, according to ministry statistics.

China mainly exports high-tech products, chemicals, plastics products and household appliances to Pakistan, and imports textiles, leather and aquatic products from the south Asian country.