HONG KONG, June 5 (Xinhua) -- Hong Kong and Taiwan will each set up a new non-governmental body to further exchanges in trade, economic and other spheres, the Hong Kong Special Administrative Region (HKSAR) government said Friday.

The agreement was announced after a work meeting on Friday between Stephen Lam, secretary for constitutional and mainland affairs of the HKSAR government, and Fu Don-cheng, deputy chief of Taiwan's mainland affairs council.

"Both sides have reached a consensus on the principles in relation to the new organizations. Hong Kong warmly welcomes this development," the HKSAR said in a news bulletin, adding that the agreement came after months of close discussions.

Under the agreement, Taiwan will establish the Taiwan-Hong Kong Economic and Cultural Co-operation Council, while Hong Kong will set up the Hong Kong-Taiwan Business Co-operation Committee (BCC) under the Trade Development Council.

The Hong Kong Trade Development Council is a statutory body and a trade promotion arm with offices in dozens of commercial centers around the world.

The BCC will have representatives from Hong Kong's commercial sector as members. It will collaborate with the Economic Co- operation Committee, which is to be established under the Taiwan- Hong Kong Economic and Cultural Co-operation Council, on issues of mutual interest, such as trade, investment, tourism and other areas.

The HKSAR government said it was hoping that "the bilateral co-operation committees will be established shortly and will hold their first meeting in the near future."

Senior officials will proactively participate in the activities of the bilateral co-operation committees, the HKSAR government said in the bulletin.

Senior officials of the HKSAR government will form a board of advisors to support the BCC. The officials on both sides can also use the platform to exchange views on matters of mutual interest and explore and discuss issues of further co-operation.

Lam arrived in Taipei on Thursday evening to embark on an official visit upon the invitation of Taiwan's mainland affairs council. He was the first secretary level official of the HKSAR government to embark on an official visit to Taiwan.

Lam had said the main purpose of his visit to Taiwan is to enhance mutual co-operation in the trade and economic sphere between the two places. He was also expected to pay a courtesy call on Ching-Ji Wu, deputy mayor of Taipei.