South Korea, China Look To FTA Talks

by Mary Swire, Tax-News.com, Hong Kong

06 August 2010

The South Korean Ambassador to China, Yu Woo-ik, has said in an interview that South Korea and China are likely to begin official talks on a free trade agreement (FTA) next year.

It can be expected that the negotiations would be the forerunner of talks on a tripartite FTA, also including Japan, which has been in discussion since 2002. Earlier this year, China, Japan and South Korea held, in Seoul, the first round of a joint study on that FTA, after the positive conclusion of a comprehensive feasibility study last year.

It is said that the eventual establishment of such an FTA between three of the top four economies in Asia would constitute the third largest free trade area in the world, after the North American Free Trade Agreement and the European Union, and would obviously be expected to have a significant effect on trade flows in the region.

China is already South Korea’s largest trading partner, but a certain amount of scepticism has been expressed from many quarters, whether the many problems which will occur in the negotiations, particularly from the agricultural sector in South Korea, can be overcome to yield significant results in the liberalization of trade between the countries.

Recommended