This is good news for both countries and will revive bilateral trade which dipped last year, a senior Japanese official told newsmen here.

China and Japan on Friday ``substantially concluded'' bilateral negotiations on China's accession to the WTO.

At the end of talks between Chinese premier Zhu Rongji and visiting Japanese premier Keizo Obuchi, the sides concluded pacts on service trade, besides goods trade protocol reached by the two nations in '97, a Sino-Japanese press communique was quoted by official Xinhua news agency as saying.

The official hoped Friday's WTO agreement would enthuse other major trading nations like US and the European Union (EU) to hasten the pace of their bilateral negotiations with Chinaon its WTO membership within this year.

``We hope the Japan-China WTO accord would spur others to speed up their efforts as China's entry into the WTO is beneficial to global trade,'' the official said in an obvious reference to the stalemate in China-US, China-EU WTO negotiations.

With the signing of the WTO deal, Japan became the first group of seven industrialised nation to officially approve Beijing's 13-year-long bid to enter the multilateral trade body which formulates global trade regulations.

Japan is China's biggest trading partner and China ranks after US as Japan's biggest trading partner.

According to Chinese Customs statistics, total foreign trade between China and Japan decreased by 4.8 per cent to 57.9 billion US dollars in 1998 compared to the same period in 1997. Analysts attribute the drop in bilateral trade due to the recession in the Japanese economy as a result of the Asian financial turmoil.

However, during first five months of 1999, trade between China and Japan reached 23.941billion US Dollars, up 9.1 per cent from the same period last year. China's exports to Japan hit 11.738 billion US dollars, up 3.6 per cent while imports went up by 15 per cent to 12.204 billion US dollars.