China and Canada have signed several trade and currency agreements amounting to nearly $2.5 billion on the eve of the opening of this year's Asia-Pacific Economic Cooperation (APEC) in Beijing.

Canadian Prime Minister Stephen Harper arrived in the Chinese capital ahead of 21 other APEC leaders to solidify trade relations with the world's second largest economy.

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The agreements were entered into by Harper and his counterpart, Prime Minister Li Keqiang at the Great Hall of the People.

Included in the pact is the long awaited reciprocal currency deal of China and Canada, fostering a much simplified trade between the Chinese yuan (or renminbi) and the Canadian dollar. Canada becomes the first country in the Americas to trade with the yuan.

The agreement will take out the need to use a middle currency for Chinese and Canadian trade. This will now allow direct trade between the two countries, reducing the costs from higher currency exchange and cut down waiting time in closing deals.

Financial and trade analysts lauded the agreement, calling the pact as a step towards Canada gaining access to the Chinese economy, and recognizing China's importance to Canadian economy.

The head of the Canadian Chamber of Commerce, Mr. Perrin Beatty, who traveled with Prime Minister Harper, praised the pact and dubbed it as a catch-up into tapping into the Chinese market.

"The rest of the world is here looking for opportunities to do business and we're playing catch-up," Betty said.

China and Canada also entered into dozens of trade agreements for anti-air pollution technology, raw materials like potash, and even blueberries that are valued at around US$2 billion.

The meeting was not limited to economic relations but also included a tricky situation that has chilled relations between Beijing and Ottawa in recent months.

Li and Harper engaged in a closed door meeting to discuss the issue of a Canadian couple detained in China under suspicion of espionage. Kevin and Julia Garrats have been held in China since August of this year.

The couple has been in China for more than 30 years operating a café when the two were arrested for espionage. No charges were formally filed against the couple but reports say that Chinese authorities have repeatedly interrogated the two.

Premiere Li states,: "As for individual cases (the Garrats), I want to reiterate that as China continues to build a country under the rule of law, I believe that judicial authorities should be able to handle cases in accordance with the law."

The Garrats case nearly scuttled Harper's attendanc at this year's APEC meeting hosted by China. Ottawa has not formally demanded for the release of the couple but the issue has turned into a major irritant in the two countries relations.

Chinese President Xi Jinping is scheduled to meet with Prime Minister Harper this Sunday.

TagsAsia-Pacific Economic Cooperation, currency, trade agreement