Park pushes for FTA while on trip to China
Park started her day with a breakfast meeting with the 71-member economic delegation. Dozens of business tycoons, including Hyundai Motor Chairman Chung Mong-koo and LG Chairman Koo Bon-moo, attended the breakfast.
“Until now, China was conceived as a low-wage production base for Korean enterprises,” Park said at the breakfast meeting. “But the current system will soon face a limit. Today, we need to pay attention to the expansion of China’s middle class.”
Noting that China’s middle class is expected to grow to 400 million people by 2020, Park urged the businessmen to pay more attention to potential gains from the quickly increasing purchasing power of the country with a long-term strategy.
“I recommend you make stronger efforts to enter the new domestic consumer goods market of China with more diversified products,” Park said. “The government will also provide you with full support.”
Since the two countries established diplomatic relations in 1992, China emerged as Korea’s largest trading partner, recording $256 billion in bilateral trade volume last year. Korea is China’s third-largest trading partner.
Park then attended the Korea-China Business Forum, and gave a speech before 220 businessmen and economic policy makers of the two countries.
Beginning with an old Chinese phrase in Mandarin, saying “first make friends, then do business,” Park stressed the importance of building trust between the two countries’ business communities to further develop economic ties.
She said economic cooperation has led the two countries’ relationship for the past 20 years, and a new vision is needed for them to take it to the next level. To this end, the Korea-China free trade agreement is the key, she said.
“There is a saying that nothing is achieved without people, but nothing is sustained without a system,” Park said.
“With your efforts, the two countries’ economic cooperation has expanded and to continue the progress, we need a stronger systemic framework. I believe the Korea-China free trade agreement can be the foundation.”
According to Cho Won-dong, Park’s senior secretary for economic affairs, the importance of concluding the free trade accord was also highlighted during Park’s summit with Chinese President Xi Jinping on Thursday.
“Xi brought up the issue first,” Cho said. “He said it is the most important agenda and said the two countries should work together to conclude a high-quality free trade agreement as soon as possible and Park also agreed.”
Five working-level talks have taken place to negotiate a free trade accord between the two countries, but little progress was seen. Cho said yesterday Park’s visit to China will give momentum to the slow negotiation.
“Since the two leaders addressed the subject with much importance, it will work as an important instruction to the two countries’ negotiators,” he said. The next negotiation takes place in Busan on July 2.
Industry, Trade and Energy Minister Yoon Sang-jick also said yesterday that important agreements were signed between Korean companies and China’s state-run oil company Sinopec.
SK Global Chemical signed an agreement for a $3 billion joint venture with Sinopec to produce ethylene. Korea National Oil Corporation also signed an agreement with Sinopec that the Chinese petroleum company will participate in the oil storage and trading hub in Ulsan.
Later in the day, Park is also scheduled to meet with Chinese Premier Li Keqiang to continue more in-depth discussions on economic issues. Efforts to increase the two countries’ trade volume to $300 billion at the earliest date and strengthening cooperation in monetary policies including the currency swap deal will be addressed, the Blue House said.
Park will also visit Xi’an today, and the visit was also seen as an important initiative for Korea’s entry to the growing western market of China. About 160 companies, including Samsung Electronics, are operating there or have plans to expand their businesses and Park’s trip is expected to boost their efforts.
BY SER MYO-JA [email@example.com]