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EU And Korea Seek Conclusion To Trade Talks

by Ulrika Lomas, Tax-News.com, Brussels

27 May 2009

European Union and South Korean leaders have affirmed that they are seeking an “early conclusion” to an “ambitious” free trade agreement following their summit in Seoul on May 23.

In a joint statement issued after the fourth such high-level meeting between European Commission officials and the South Korean government, summit leaders “welcomed in particular the considerable progress in negotiations on the revision of the ROK-EU Framework Agreement for Trade and Cooperation signed in 1996 and on an ambitious ROK-EU Free Trade Agreement.”

“They looked forward to an early conclusion of negotiations on both agreements,” the statement added.

The agreement on trade and a range of other bilateral issues was made by South Korean President Lee Myung-bak, European Commission President Jose Manuel Barroso and Vaclav Klaus, president of the Czech Republic, which currently holds the EU's rotating presidency.

While the statement did not appear to give a specific timetable for the completion of the free trade agreement, it is hoped that a final deal can be signed off before the end of this year.

The EU and South Korea have reached a tentative free trade deal that would eliminate 97% of tariffs on trade in goods and services between the two territories. However, although negotiators reached a preliminary agreement in March, it emerged that both sides were still in disagreement over the issue of duty drawback.

Both sides have also agreed to revise the Framework Agreement for Trade and Cooperation, which entered into force in 2001. This aims to encourage broad-based co-operation in fields such as transport, energy, science and technology, industry, environment and culture.

South Korea is the EU's eighth largest trade partner and the EU has become South-Korea's second largest export destination. EU trade with South Korea exceeded EUR65bn in 2008 and has enjoyed an annual average growth rate of 7.5% between 2004 and 2008.

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