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Yonhap News Agency - 11 June 2020
S. Korea, Cambodia move closer to launching FTA talks
By Kang Yoon-seung
South Korea said Thursday it has made further progress in fleshing out details for the planned free trade agreement (FTA) with Cambodia, as Seoul seeks to broaden economic ties with Southeast Asian nations and diversify its export portfolio.
Seoul plans to hold a public hearing on the envisioned FTA on Friday by inviting related experts, which is mandatory under the local law before seeking a commerce treaty, according to the Ministry of Trade, Industry and Energy.
In November, the two Asian countries launched a joint feasibility study on their potential FTA in line with South Korea’s summit with the Association of Southeast Asian Nations (ASEAN).
South Korea and Cambodia completed the study last month and agreed to start domestic procedures to pave the way for official talks.
South Korea’s exports to Cambodia reached US$696 million in 2019, up 5.5 percent from a year earlier. Its imports from the Southeast Asian country came to $335 million, up 6.8 percent on-year.
The country mainly shipped textile materials and used freight trucks to Cambodia and imported finished clothing goods.
Cambodia is an attractive trading partner, as the Southeast Asian country has been posting annual economic growth of around 7 percent since 2011, the ministry said in a statement.
South Korea has already inked an FTA with the ASEAN, but it is seeking to clinch individual agreements as well to expand its economic ties with Southeast Asia and ease its trade dependency on the United States and China.
Such efforts became more crucial recently, as the relationship between the world’s two largest economies soured recently over trade and the COVID-19 pandemic. China and the U.S. accounted for nearly 40 percent of South Korea’s combined exports in 2019.
In January, Seoul and Manila held the fifth round of official negotiations for their FTA. Talks with Malaysia are also in progress.
Seoul aims to conclude the Regional Comprehensive Economic Partnership (RCEP) that also covers ASEAN members by the end of this year.
ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Thailand, Singapore and Vietnam.
The upcoming free trade deals are expected to lay the groundwork for South Korea to rekindle its ailing exports in the post-pandemic era.
South Korea’s exports dropped for the third consecutive month in May, slipping 23.7 percent, due to the growing economic fallout from the pandemic that has disrupted the global supply chain.