CHONGQING, June 29 (Xinhua) -- Chinese mainland and Taiwan negotiators signed the long-awaited Economic Cooperation Framework Agreement (ECFA) in Chongqing Tuesday afternoon, a move hailed by many as a milestone in cross-Strait relations.

Aiming to establish a systematic mechanism for enhancing cross-Strait economic cooperation, the ECFA was agreed upon by the mainland's Association for Relations Across the Taiwan Straits (ARATS) and Taiwan's Straits Exchange Foundation (SEF).

The ARATS and SEF handle cross-Strait issues on behalf of their respective authorities.

The ECFA will formally take effect one day after both sides "complete due procedures and notify each other," the agreement said.

Under the 16-article agreement, the two sides agreed to "gradually reduce and remove trade and investment barriers and create a fair environment" in the two areas.

ARATS President Chen Yunlin said in an interview with Xinhua that the agreement would help the mainland and Taiwan jointly deal with increasingly difficult competition in the world economy and see mutual benefits as the economic advantages complement each other.

Chiang Pin-Kung, Chairman of the SEF, said that the ECFA would not only be a milestone in the development of cross-Strait economic relations, but also a giant leap for both sides toward economic integration and globalization.

Chinese mainland, the world's third largest economy, has been Taiwan's largest trading partner and export market since 2007, according to statistics released by both sides.

Taiwan has been the sixth largest trading partner of the mainland, with an accumulated cross-Strait trading volume reaching 960 billion U.S. dollars by the end of 2009.

The agreement also provides protection for cross-Strait investments to boost two-way capital flows.

A list of items and services to benefit from the pact first with preferential duty cuts and treatment, dubbed the "early harvest program," was agreed on by both sides.

The "early harvest program" will launch within six months of the ECFA taking effect, the agreement said.

The two sides will reach their zero-tariff goal on commodities as outlined in the "early harvest program" within two years after implementation of the program.

Under the agreement, the two sides will continue discussing agreements for commodity trade, service trade and investment for six months after the ECFA takes effect.

Further discussions on commodity trade agreement will include: tariff reduction and removal; rules of origin; customs procedures; and trade remedies.

Discussions on service trade agreement will focus on cutting and removing restrictive measures gradually, enlarging the service sectors covered, and enhancing cross-Strait cooperation.

Meanwhile, discussions concerning cross-Strait investment aim to establish an investment protection mechanism, enhance transparency of relevant regulations, reduce restrictions on investment, and facilitate unhindered investment.

In order to further increase the benefits of the ECFA, the two sides also agreed to enhance cooperation in intellectual property protection, finance, trade facilitation, customs, and E-business.

They would also help promote cooperation between small and medium-sized enterprises across the Taiwan Strait, and help economic and trade organizations to set up offices on each other's side of the Strait.

In addition, the mainland and Taiwan will jointly set up a committee for cross-Strait economic cooperation to ensure ECFA agreements can be reached and to supervise the implementation of the ECFA.

The committee will also interpret terms of the ECFA and publicize major information concerning cross-Strait economics and trade.

The committee will hold routine meetings every six months and may have interim meetings upon agreement by the two sides.

The committee will also serve as the authority to deal with ECFA-related disputes until the two sides reach a separate agreement on dispute settlement.

Negotiation for the dispute settlement agreement will start within six months of the ECFA taking effect.

Also on Tuesday, a separate agreement on intellectual property rights protection (IPR) was signed by the ARATS and the SEF.

According to the IPR agreement, the Chinese mainland and Taiwan will increase exchange and cooperation to boost protection of patents, trademarks, copyright and plant variety rights (PVR).

After the SEF and the ARATS achieved the two agreements, scholars from both sides of the Strait expressed a positive view on the future development of the cross-Strait relationship.

"Service trade directly benefits common residents living on both sides", said Andy Chang, professor in the graduate institute of China studies at Taiwan-based Tamkang University.

Also, high-quality service industries would provide more choices for the mainland population and the ECFA will also promote cross-Strait investments from manufacturing industries to the high value-added service industries, Chang said.

Further, the ECFA would not only be a mutually beneficial platform for the mainland and Taiwan, but also a channel for both sides to better connect to other economies in the Asia-Pacific region, he added.

Although profits from some industries on both sides will be affected, many more industries will benefit, said Guo Li, associate professor with Huaqiao University based in southeast Fujian Province.

The ECFA will also provide an opportunity for those affected industries to speed up their industrial upgrading and find new market orientations, which will also help Taiwan improve its industrial structure, Guo said.