Korea, Thailand agree to preliminary FTA talks, upgrade ties to 'strategic partnership'

South Korea and Thailand agreed Saturday to launch preliminary talks toward a possible free trade deal as their leaders pledged to upgrade relations between the two countries to a "strategic partnership."

South Korean President Lee Myung-bak and Thai Prime Minister Yingluck Shinawatra reached the agreement during summit talks in Bangkok, pledging to work closely together to expand bilateral trade volume to US$30 billion by 2016, according to a joint statement.

"Both sides agreed to seek preliminary discussions and a joint study about forging a comprehensive economic partnership agreement (CEPA) in order to strengthen economic links between the two countries," the joint statement said.

CEPA is the equivalent of a free trade agreement.

After the summit, South Korean Foreign Minister Kim Sung-hwan and his Thai counterpart, Surapong Tovichakchaikul, signed a memorandum of understanding that officially elevated the relations between the two countries to a "strategic partnership."

"I firmly believe the two countries will open up an era of higher level of cooperation," Lee said during a joint news conference with Yingluck. "I take pride in that we were able to move bilateral relations forward and reach agreement in various areas ahead of next year's 55th anniversary of relations."

The sides also agreed to put in "serious efforts" to conclude a trade and economic cooperation "action plan" for 2013-2017 at an early date to further energize trade and minimize trade barriers.

Trade between South Korea and Thailand reached an all-time high of $13.9 billion last year.

Lee and Yingluck also called for launching aviation talks at an early date to facilitate people-to-people exchanges and transfers of goods and services at a time when the number of people visiting each other's nation topped 1.3 million last year.

They also agreed to look into the possibility of Korean financial institutions having a presence in Thailand to help facilitate investment and exchanges between the sides. They also welcomed cooperation in various Thai infrastructure projects, especially its water management system, high-speed railway and power plant construction projects.

After last year's devastating floods, Thailand has been working on a massive $11.3 billion project to build a water resources management system, and Yingluck has expressed keen interest in South Korea's project to refurbish its four major rivers in a way that prevents floods, preserves water resources and promotes tourism along the waterways.

In Saturday's summit, Lee asked for South Korea's participation in the project, stressing that his country can be the best undertaker of the project as seen in the successful completion of its four river refurbishment, a presidential official said.

Yingluck, in response, was quoted as saying, "In the field of water resources management, South Korea is successful in a way that needs no more words."

"I highly commended that the Thai government has been working on a large-scale water resource management system for the sake of long-term national development and improvement in the quality of people's lives, and explained about our experiences of the four river project," Lee told the joint news conference.

"Both sides agreed to work together to share water resource management experiences and technologies in a mutually beneficial fashion," he said.

Later Saturday, Lee toured the Chao Praya river and the Lad Pho canal on the outskirts of Bankok in a move seen as underlining South Korea's willingness to share its water management experience and know-how.

"Climate is unpredictable. South Korea experienced three typhoons in a couple of months this year. Had it not been for the four river project, the entire South Korea would have suffered massive flooding," Lee said during the tour.

In a briefing to Lee, a Thai deputy prime minister said that rising sea levels due to climate change may raise the possibility that the Southeast Asian nation would suffer flooding more frequently. Lee reponded that the whole world should work together to tackle global warming.

The bidding process is under way for the Thai project. A total of 34 bidders have applied for the project, and eight of them, including two involving South Korean firms, have passed a preliminary qualification test.

The successful bidder is expected to be chosen around April.

Lee, who arrived in Bangkok on Friday, is the first South Korean president to make an official bilateral visit to Thailand in 31 years. Some of his predecessors have visited the country in between, but all of those trips were to attend multilateral conferences.

Thailand was one of the first countries to dispatch troops to help South Korea repel invading troops from North Korea during the 1950-53 Korean War. A total of 15,708 Thai soldiers participated in the war and peacekeeping efforts thereafter, and 136 of them were killed and 1,160 wounded.

Upon arrival in Bangkok on Friday, Lee immediately headed off to a Korean War memorial set up at an army base, some 90 kilometers east of the capital, to lay a wreath and pay his respect. Lee was the first South Korean president to do so.

Thailand is the last stop of Lee's two-nation Southeast Asian trip that already took him to Indonesia's resort island of Bali for a regional democracy forum and summit talks with Indonesian President Susilo Bambang Yudhoyono. (Yonhap)