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S. Korea, EU to Hold Free Trade Talks in Vienna

Korea Times, Seoul

S. Korea, EU to Hold Free Trade Talks in Vienna

14 December 2008

South Korea and the European Union will hold a meeting in Vienna this week to resolve contentious issues such as auto trade and rules of origin in their free trade negotiations, Yonhap News reported Sunday quoting officials.

During the inter-session meeting that will run from Monday through Wednesday, South Korean Deputy Trade Minister Lee Hye-min and his European counterpart Ignacio Garcia Bercero will discuss how the two sides can strike a deal as soon as possible.

Since signing a free trade agreement (FTA) with the United States last year, South Korea has held seven rounds of negotiations with the EU in a bid to gain a greater footing in the 27-nation economic bloc, South Korea’s second-largest trading partner after China.

During their seventh round of negotiations in May, the two sides reported "significant" progress in their free trade negotiations, saying they had agreed to reach a deal within the year.

A date for the eighth round of talks has not yet been set, but will be held depending on the results of the forthcoming negotiations, the officials said.

The negotiations have made little headway as both sides have been reluctant to accept each other’s demands on tariff reductions, rules of origin and auto trade and auto-related technical standards.

Bilateral trade between South Korea and the EU came to $93.07 billion in 2007, and some unofficial studies suggest an FTA would boost that figure by as much as 40 percent in the long run. The EU is also the largest foreign investor in South Korea, with outstanding investment reaching $43.40 billion at the end of 2007.

South Korea is seeking to sign FTAs with as many countries as possible in an effort to strengthen its export-oriented economy. Currently, South Korea has FTAs with Chile, Singapore and the European Free Trade Association, as well as a partial pact with the Association of Southeast Asian Nations. The Korea-U.S. agreement has been signed but still awaits approval by the legislatures of both nations.