Abstract:  ChinaAustralia FTA and ChinaKorea FTA have profound impact on China’s economy, trade and industry. The paper is aimed to analyze their potential impact on the basis of GTAP model while taking into consideration of capital accumulation model and total factor productivity effect. The results reveal that ChinaKorea FTA and ChinaAustralia FTA are expected to increase China’s welfare, GDP and foreign trade; the overall economic effect of the two FTAs’ is more than the sum of the individual’s; ChinaKorea FTA’s potential effect on promoting China’s economy and trade is significantly greater than that of ChinaAustralia FTA; and the expectation of open trade from ChinaAustralia FTA and ChinaKorea FTA will improve China’s technological progress, thus making the greatest contribution to China’s economic welfare. In addition, both the output and the addedvalue of all China’s manufacturing sectors would benefit from the implementation of the two FTAs, while the output of some agriculture sectors is expected to suffer from the negative impact to varying extents.

Key words:  ChinaAustralia FTA, ChinaKorea FTA, GTAP, trade liberalization, trade relation