CHINA's State Council has approved the establishment of a pilot free trade zone in Shanghai, according to a recently posted statement of the Ministry of Commerce.

Covering 28.7 square kilometres, the new zone will be built on the basis of existing bonded zones, the Waigaoqiao Free Trade Zone, Waigaoqiao Free Trade Logistics Park, Yangshan Free Trade Port Area and Pudong Airport Comprehensive Free Trade Zone.

Ministry of Commerce statement, quoted by Xinhua, said the zone is a crucial move in adapting to global economic and trade development and imposing a more proactive opening-up strategy, adding that it will help explore a new path for China's opening up, speed up transformation of government functions and promote economic restructuring.

Experiences gained from the pilot zone are expected to be copied in other parts of the country, according to the statement.

The zone is expected to strengthen China's global competitiveness and serve as a new platform for the nation's cooperation with other countries, and contribute to efforts in developing "an upgraded version of China's economy," said the statement.

The general plan for development of the zone is undergoing relevant approval procedures, and will be announced later, said the report.