China and Mongolia will soon start conducting a joint feasibility study for the development of a free trade zone, a Chinese official said on Tuesday.

Qian Keming, a vice-minister of commerce, said the move highlights the ever strengthening Sino-Mongolian relations "on the basis of mutual respect, equality and benefit".

The Second China-Mongolia Expo is slated to take place in Hohhot, capital of China's Inner Mongolia autonomous region between September 26 and 30 this year. Through exhibitions, conferences and seminars, investment and trade negotiations, the expo will serve as a communication platform for all sides, Qian said at a press conference.

The biennial event aims to boost bilateral cooperation in politics, economy, education, health and culture, and to facilitate the Belt and Road Initiative and China-Mongolia-Russia Economic Corridor.

For over a decade, China has been Mongolia's largest trading partner. According to China's Ministry of Commerce, Sino-Mongolian trade amounted to $3.1 billion in the first half of this year, up 44.2 percent from a year ago. In the same period, China's non-financial direct investment in Mongolia reached $4.1 billion, accounting for 30 percent of Mongolia's total foreign investment.

Earlier in 2016, bilateral trade reached $4.61 billion, accounting for 60 percent of Mongolia's export volume, data from the ministry shows.

China mainly exports gas, diesel, food, machinery and equipment to Mongolia, and imports natural resources, fur and raw materials.