Korea seeks out strong relations with Argentina

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Korea seeks out strong relations with Argentina

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Korea may have been defeated by Argentina in the group-play stage of this year’s World Cup, but that doesn’t appear to have harmed Seoul’s growing interest in developing stronger ties with the South American country.

The two countries established diplomatic ties in 1962, marking the start of a steady rise in economic exchanges between both countries.

According to the Korean International Trade Association, Argentina is currently the 47th biggest exporter to South Korea and the 57th largest importer.

The total sum of foreign trade between South Korea and Argentina was $1.17 billion last year and $1.02 billion through August this year.

Argentina’s largest exports to Korea are soy, fuel and lubricants, grains, fruits and cereals.

Argentina is currently South America’s second biggest economy with a GDP per capita of $13,400 as of 2009 and a labor force of 16.4 million, which ranks 37th in the world, according to the CIA World Factbook.

The country suffered a financial and economic crisis between 1999 to 2002, which affected trade with Korea.

However, Argentina has recovered because of its abundance of natural resources, which has lead to growing exports of soybeans, natural gas and oil resources, especially when global demand for commodities is rising.

Major investment banks like J.P. Morgan, Goldman Sachs and UBS have predicted a high growth rate for Argentina this year ranging from 6.8 to 9.7 percent, which is a better performance than last year.

Despite fluctuating trade numbers over the past 35 years, cooperation between Argentina and Korea has been growing steadily stronger in the wake of Argentina’s recovery.

Argentina has also showed interest in Korea’s development policies to see if any can be applied to its own economy.

Diplomatic ties grew closer when Kim Young-sam, as Korea’s president, made the first visit by a Korean leader to Argentina.

This was followed up with a visit by Roh Moo-hyun in 2004 during his presidency. During that visit, he signed several agreements on economic cooperation, education, mining, natural resources, technology, agriculture and information technology.

The diplomatic relations between the countries was described at the time as a “comprehensive cooperative relationship for the common prosperity in the 21st century.”

A memorandum of understanding was also signed during the 2004 visit between Banco de la Nacion Argentina and the Export-Import Bank of Korea.

In 2008, Yu Myung-hwan, then Korea’s foreign minister, and Argentina’s foreign minister Jorge Enrique Taiana engaged in talks on how to foster further development between the two countries as bilateral trade grew from $420 million in 2002 to $1.2 billion in 2007.

Korea and Argentina have continued to cooperate on projects since then, with the two countries signing an memorandum of understanding in September in which Korea agreed to help cooperate in the development of Argentina’s nuclear power industry.

The agreement has laid the foundation for Korea possibly receiving an order to build a nuclear power plant in Argentina.

This could pave the way for more cooperation in other business sectors, say analysts.


By Christine Kim [christine.kim@joongang.co.kr]
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