Taiwan is likely to sign a new economic agreement with Japan this year, the third since September and a step towards a free trade pact, the economy minister said Wednesday.

Shih Yen-shiang made the disclosure to reporters in Taipei, but did not give details about what the agreement might involve.

Asked to expand on Shih's remarks, an official at the economy ministry told AFP the agreement would be "part of our efforts to work towards the supreme goal of reaching a free trade agreement," but also declined to give details.

In September, Taiwan and Japan inked an investment agreement aimed at promoting, protecting and liberalising investment flows between the two sides despite the lack of formal diplomatic relations.

In November, Taipei and Tokyo signed an open skies agreement, lifting restrictions on the number of carriers that can offer scheduled passenger services between the two.

The two agreements have been made possible by what seems to be a decision by former rival China to adopt a more liberal attitude towards Taiwan signing economic pacts, amid warming ties.

Japan formally recognises China rather than Taiwan but has maintained close ties with the island, which it colonised from 1895 to 1945.

channelnewsasia.com