Swiss Economic Affairs Minister Doris Leuthard and Chinese Commerce Minister Bo Xilai pledged in Beijing to study the feasibility of a free trade deal.

In a statement released on Sunday after their meeting, Switzerland said it has recognised China as a market economy -- a key buffer against trade disputes between the two countries over the price applied to Chinese goods.

The two ministers also agreed in Beijing to set up a working group meant to bolster intellectual property rights, a key issue for Switzerland whose watchmaking and pharmaceutical industries have pressed for more stringent efforts against piracy.

China and Switzerland also established a working group to help Swiss businesses invest in China, and to attract Chinese investors to Switzerland, the Swiss ministry said.