'We have reached agreements on the deal and will sign the contract this week,' Galvez said.

The joint venture will be located in the western Colombian city of Pereira, where Busscar is headquartered, he added, without providing further details.

Visiting Colombian president Alvaro Uribe Velez said earlier today at a trade conference between Chinese and Colombian companies that the FAW and Busscar factory will launch its first vehicles in December this year.

FAW Group, the parent of FAW Car Co Ltd (SZA 000800) and Tianjin FAW Xiali Automotive Co Ltd (SZA 000927), currently has two overseas assembling factories, one in Tanzania and another in South Africa.

The group sold a total of one mln vehicles in 2004, up 12.35 pct year-on-year, figures from the China Association of Automobile Manufacturers (CAAM) showed.

(Source: AFX)