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Seoul, Brussels reaffirm pledge to strike free trade deal by year end

Yonhap | Friday October 10, 2008

Seoul, Brussels Reaffirm Pledge to Strike Free Trade Deal by Year End

BRUSSELS, Oct. 10 Asia Pulse — South Korea and the European Union (EU) have reaffirmed that they will strike a free trade deal by the end of the year, a top Seoul trade official said Friday.

Since concluding 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 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.

"The two sides shared the view that the trade deal will be completed within this year," Lee Hye-min, Seoul’s top negotiator for the free trade talks, said in an interview with Yonhap News Agency.

Lee held a two-day meeting here with his EU counterpart Ignacio Garcia Bercero to resolve contentious issues such as auto trade and rules of origin.

A date for the eighth round of talks has not yet been set, but will be held depending on the results of minister-level talks likely to be held next month, Lee said.

The South Korean negotiator said the two sides are still sparring over some of the most divisive issues such as tariff reduction and rules of origin, along with auto trade and auto-related technical standards.

"Differences on the issues still remain because they are not separated, but interlinked," Lee said. "But we cannot rule out the possibility that the issues could be resolved once both sides make concessions to each other."

The negotiations have made little headway as both sides have been reluctant to accept each other’s demands on the divisive issues.

Bilateral trade came to US$89.8 billion in 2007, with some unofficial studies suggesting 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 $44.8 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.

Seoul is also seeking similar trade deals with Canada, India and Mexico.

 source: Asia Pulse