Shanghai on January 27 officially announced plans to set up a pilot free trade zone (FTZ) that would meet international norms in its Pudong New Area, the city's financial and commercial hub, in 2013.

FTZ refers to an area within which goods may be landed, handled, manufactured or reconfigured, and re-exported without the intervention of customs authorities.

Shanghai has applied for a permit to build the FTZ on the basis of its existing comprehensive bonded zones.

If the application is approved, it would become the first FTZ on the Chinese mainland, said sources with the government of Pudong New Area.

Building the FTZ is one of the Shanghai Municipal Government's major tasks in 2013, said Yang Xiong, Acting Mayor of Shanghai, at the first session of the city's 14th Municipal People's Congress.

It will take about three years to build an FTZ that meets international standards, said Wan Zengwei, Director of the Pudong Academy of Reform and Development in Shanghai.