logo logo

Germany supports Korea-EU free trade pact

Korea Times | 5 April 2007

Germany Supports Korea-EU Free Trade Pact

By Park Hyong-ki
Staff Reporter

Germany, one of the founding members of the European Union (EU), will fully support an EU free trade agreement (FTA) with Korea, as it will boost bilateral trade and investment between the two economies.

``We will most probably see a swifter resolution of the FTA talks, compared with the Korea-U.S. FTA, since there are less sensitivity issues between the two sides, and Europe has great confidence in Korea,’’ Jurgen Wohler, secretary general of the Korea-German Chamber of Commerce and Industry, said in an interview with The Korea Times.

The newly appointed secretary general added that it would be satisfactory if the Korea-EU FTA is agreed upon on a similar level to the KORUS FTA.

However, Wohler has doubts that an agreement can be reached by the end of this year as the Korean government believes because ``the EU will need time to coordinate a consensus and opinion among its members.’’

Like all negotiations, the two will have to overcome some major obstacles ahead.

For Germany, automobiles are one of the thorniest issues to be dealt with over fears that its automobile market for mid-to-low priced sedans will be dominated by Korean carmakers, which are gaining momentum in Europe.

The EU applies a 10 percent tariff on imported vehicles and 14 percent on electronic appliances such as LCD and PDP televisions _ two of Korea’s key export commodities to the 27-member union, accounting for over 22 percent of the nation’s total exports to the EU.

Korean exports to the EU hit $48.4 billion last year of which exports to Germany reached over $9.3 billion. Korea imported German goods worth $10.2 billion in 2006.

The secretary general believes that the two sides will not face much difficulty in free trade talks over agriculture, as Korea and the EU share a common viewpoint on that sector.

``From Germany’s perspective, the Korean agriculture market is not a significant issue for us (to gain access),’’ Wohler said. ``Like Korea, the EU also heavily subsidizes local farmers.’’

The trade ministry in Seoul also noted that imports of European agricultural products do not take up much of the market in Korea.

In case of Korea-Germany trade relations, both countries share in importing and exporting high-tech products to one another.

``Germany is Korea’s second largest customer in shipbuilding, and the No. 1 supplier of machinery parts to Korea’s shipbuilding industry,’’ said Wohler. ``German companies like Merck and Schott work with Samsung and LG in producing LCD and PDP TVs. Korea has become an important partner by which we can further enhance our cooperation in the high-tech industry through an FTA.’’

 source: Korea Times