China's Wen backs Taiwan trade pact

Chinese Premier Wen Jiabao hailed a thaw in relations with Taiwan on Friday and vowed to push forward cooperation between the two sides including a landmark trade agreement.

"Last year, relations between the two sides of the Taiwan Strait made important progress from a historic new starting point, and a positive trend toward peaceful development emerged," Wen said in an address to parliament.

Taiwan and China have been governed separately since the end of a civil war in 1949 but Beijing considers the island part of its territory and has vowed to get it back, by force if necessary.

However, tensions have eased markedly since Taiwan President Ma Ying-jeou took office in 2008 on a China-friendly platform.

Talks held in January

The two sides held their first round of formal talks in late January aimed at eventually signing a trade pact, known as the Economic Cooperation Framework Agreement, which is expected to boost trade by easing barriers.

Wen called for completion of the agreement, which he said would be mutually beneficial.

"We will promote a win-win situation and set up an economic cooperation mechanism that reflects the characteristics of both sides by negotiating and signing an economic cooperation framework agreement," he said.

Ma's government said Monday it aimed to hold a second round of formal trade talks with China early this month, hoping to discuss which industries would be entitled to preferential tariff status under the agreement.

The two sides met in Beijing in late January to decide on an agenda for future talks and other procedural issues.

Last week, Taiwan Premier Wu Den-yih warned the island would "drown" if it fails to sign the trade pact amid formidable competition from rivals in the region.

But the opposition Democratic Progressive Party, which favours independence from China, strongly opposes the pact, which it says would demote Taiwan to the status of a local government in future talks with the mainland.