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South Korea, Japan, China To Prepare For FTA Talks

by Mary Swire,, Hong Kong

02 October 2012

On September 27, a third preliminary working-level consultation was held in Seoul on the ways to move forward prospective negotiations on the proposed South Korea-China-Japan free trade agreement (FTA).

The South Korean delegation was led by Kim Young-moo, Director-General for FTA Negotiations at the Ministry of Foreign Affairs and Trade, while the Chinese and Japanese delegations were headed by Sun Yuanjiang, Deputy Director-General of the International Department of the Ministry of Commerce, and Kenji Goto, Deputy Director-General of the Economic Affairs Bureau of the Foreign Ministry, respectively.

With the three rounds of such consultations already completed, it was disclosed that the three countries will start to undertake their respective domestic procedures to determine whether to launch negotiations for a trilateral FTA. For example, the South Korean government will hold public hearings and proceed with other domestic procedures related to the possible launch of the trilateral FTA negotiations.

The consultations were launched after the three countries’ premiers met in May this year at the signing of a tripartite investment agreement. It was then recognized that, if a deal could be reached, the mutual benefits arising from a trilateral FTA could be substantial.

Trade between the three countries was said to have grown to some USD690bn last year. While China is the main trading partner for both Japan and South Korea, Japan and South Korea are China’s fourth and sixth trading partners, respectively.

However, it has also been recognized that the issue of sensitive goods and services could be challenging for all three countries and, while Japan and South Korea are competitors in the supply of many manufactured and technological goods to China, tariffs on the import of agricultural products from China would be also be a problem for both those countries.

At the same time, negotiations are progressing on a bilateral FTA between South Korea and China. The third round of these talks was held in August this year and a fourth round is being programmed for next month.

There is also movement to create a regional trade treaty in East Asia. It has been agreed that the Association of Southeast Asian Nations (ASEAN) should begin talks on a new regional trade treaty, in November this year, with its current six free trade agreement partners - Australia, New Zealand, China, India, South Korea and Japan.

TAGS: tax | free trade agreement (FTA) | tariffs | trade treaty | China | agreements | Korea, South | import duty | trade | Association of East Asian Nations (ASEAN) | Japan

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