DPA | Tue, 20 Jan 2009

South Korea, EU fail to reach deal on free trade agreement

Seoul - South Korea and the European Union on Tuesday reported progress in the latest round of talks on a free trade agreement, but problems remained. The outstanding issues were "inevitably complex and complicated," EU Trade Commissioner Catherine Asthon said in Seoul.

"I hope my presence here demonstrates the priority that we place upon this free trade agreement, and certainly I’m putting a lot of effort into resolving the outstanding issues."

Both sides could report progress in important areas and had reached a significant degree of agreement, South Korean Trade Minister Kin Jong Hoon said.

The two days of talks that ended Tuesday dealt with industry tariffs, services and non-tariff obstacles in car imports. Open questions remained regarding import duties.

Car imports remain a major divisive issue. The EU wants South Korea to replace all its existing regulations for European imported cars with international standards.

The talks, which started in May 2007, are to continue in early March. South Korea hopes to reach agreement on a comprehensive agreement abolishing import tariffs and other trade obstacles in the first quarter of 2009.

Trade between the EU and South Korea was at about 90 billion dollars in 2007, making the EU the country’s second-largest trade partner after China.