A chance to promote FTAs

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A chance to promote FTAs

Published: 28 Mar. 2012, 20:47

Korea signed a provisional agreement on a free trade deal with Turkey early this week. If ratified by the National Assembly, the trade pact takes effect in the first half of the year. Turkey, with a 74-million-strong population, is the first Islamic state to sign a free trade agreement with Korea and is Korea’s ninth FTA partner.

Though the bilateral trade volume between Korea and Turkey is smaller than what we have with other countries - exports from Korea amount to $5.1 billion and imports $800 million - the free trade pact with Turkey carries great significance. The country has a strategic location linking Europe and Asia and the highest economic growth rate among Muslim countries across the world. Turkey’s domestic market is not only expanding rapidly, but its geopolitical location could also provide a strong foundation for our export companies to enter the African market, not to speak of the Middle East and Europe. Simply put, Turkey is a market with great potential.

Though the ad hoc trade pact with Turkey is confined to the area of commercial trade, Korea and Turkey agreed that both sides will do their best to conclude negotiations on other fields like service, investment and government procurement. As a result, when the two governments finalize agreements on those areas, it will help boost the bilateral trade volume between the two countries and activate various types of services and investments in the Middle East, Africa and the Mediterranean. The FTA is also likely to facilitate an ongoing negotiation to sell a $20 billion nuclear power plant to the country.

When the Korea-Turkey FTA goes into effect, our share of trade through FTAs is expected to increase to 46.8 percent of our total trade volume. In other words, our government’s commerce strategy - based on the idea of connecting the global market as tightly as possible through FTAs - is finally paying off.

However, a remarkable surge in trade volume alone can hardly satisfy people’s growing expectations. That’s why the government must make the merits of FTAs palpable to ordinary citizens by demonstrating that the trade deals actually create jobs for them and boost their income, instead of export companies and conglomerates monopolizing the benefits from FTAs. Only then can the government effectively refute the argument that the Korea-U.S. FTA be scrapped or that a negotiation for a Korea-China FTA should be forgone. We hope the Korea-Turkey FTA will provide a good opportunity to change some of the hostility toward FTAs.