Earlier this month, the 25-year-old revealed that his agent was in discussions with an unnamed club – believed to be Arsenal – over a move away from the Chinese Super League.
According to SportMediaSet, personal terms have been agreed between the Gunners and Carrasco. Arsenal are only believed to have around £40m to spend on new signings in this summer’s transfer window.
Watch video Carrasco – Skills and GOALS
Carrasco moved to China from Atletico Madrid last February and has scored 14 times and registered 11 assists in 36 appearances for the Blue Hawks.
The 25-year-old has been on Arsenal’s radar since January and almost joined on loan before Unai Emery switched his attention to Barcelona’s Denis Suarez instead.
Suarez’s failure to make an impression in north London means that the club have revisited a potential move for Carrasco and they made an enquiry about taking him on loan with an option to buy.
Dalian Yifang are reluctant to loan Carrasco out and would rather offload him permanently in order to reinvest the funds on securing a replacement.