S Korea, EU to meet next week for FTA talks
Yonhap | April 15, 2008
S KOREA, EU TO MEET NEXT WEEK FOR FTA TALKS
SEOUL, Apr 15, 2008 (AsiaPulse via COMTEX) — — Top trade officials from South Korea and the European Union (EU) plan to meet in Japan next week to discuss how both sides will carry out the ongoing free trade negotiations, Seoul’s chief negotiator for the talks said Tuesday.
Seoul has held six rounds of negotiations with Brussels on a free trade agreement (FTA) that could provide Asia’s third-largest economy with a commercial bridge to Europe.
But the negotiations moved at a snail’s pace as both sides remained reluctant to accept each other’s demands on tariff concessions, auto trade and auto-related technical standards, one of the most divisive issues in the negotiations.
According to chief negotiator Lee Hye-min, South Korea’s trade minister Kim Jong-hoon and EU trade commissioner Peter Mandelson will meet in Japan next Tuesday to discuss how the two sides can help the free trade negotiations progress smoothly.
Auto tariff and auto-related technical standards, among other issues, are regarded as major hurdles. Brussels wants Seoul to cut regulations for European carmakers by applying international standards instead of domestic rules.
South Korea also said earlier that there has been some progress in rules of origin. Saying the rules are too strict, Seoul, however, urged Brussels to ease related rules under which a product is only considered as manufactured by a trading partner if at least 60 per cent of the finished item is made in that country.
South Korean manufacturers are trying to outsource more parts from neighboring countries like China to cut costs, which means that the EU’s country-of-origin rules would not benefit them much.
The 27-nation economic bloc is demanding that South Korea cut tariffs on cars and other products to the same extent that it did in the trade deal with the United States.
The EU is South Korea’s second-largest trading partner after China, with bilateral trade reaching US$89.8 billion in 2007. Some unofficial studies suggest a free trade agreement would boost that figure by as much as 40 per cent in the long run.
If implemented, the free trade pact would be the largest for South Korea, surpassing the agreement signed with the United States, which is still under legislative review.
The EU is also the largest foreign investor in South Korea, with US$44.8 billion invested as of the end of 2007.
Currently, South Korea has free trade agreements with Chile, Singapore and the European Free Trade Association as well as a partial pact with the Association of Southeast Asian Nations. Seoul is also seeking similar trade deals with Canada, India and Mexico.
