Korea, China set to conclude FTA discussionsKorea and China have nearly come to the end of negotiations on a bilateral free trade agreement (FTA), which have so far lasted nearly 30 months.
Ahead of a presidential summit scheduled for today between Korea and China, trade officials from both governments made last-minute efforts yesterday in Beijing, where the Asia-Pacific Economic Cooperation (APEC) conference is being hosted, to conclude the 14th round of talks on the Korea-China FTA.
The officials are expected to continue negotiations overnight to narrow differences on a few issues: when to open both countries’ agricultural and fisheries markets; what types of commercial goods will be freely traded; how to open the service market; and how to set product-specific rules of origin, among others.
Pending a successful arrangement, Korean Trade Minister Yoon Sang-jick and his Chinese counterpart, Gao Hucheng, will conduct a ministerial meeting prior to the summit to officially conclude negotiations.
Korea wants to categorize its agricultural products and some commercial goods manufactured by small businesses as super-sensitive items in order to protect those markets, while China wants Korea to fully open them. China also wants to keep its commercial goods market from being exposed to competition with strong Korean manufacturers.
Officials had anticipated earlier last week that FTA negotiations between Korea and China would conclude without issue, in part due to a favorable atmosphere between the two governments.
On Thursday, the two sides held an all-night negotiation session on the extent to which they would open their agricultural markets and reached some sort of agreement, according to an official at Korea’s Ministry of Trade, Industry and Energy. They moved on to discussions concerning commercial goods on Friday.
During the two-day talks, both sides agreed to make some concessions: Korea agreed to reduce the number of agricultural items it wanted to protect from tariffs over a certain period, and China also conceded to reduce the number of its commercial goods that would receive certain protections.
On Saturday, China reneged, deciding to review agricultural conditions and effectively halting talks.
In yesterday’s discussions, the two sides tried again to narrow the differences on their agricultural and fisheries markets. Korea requested that China recognize Korean-made products that are assembled with parts or materials made in China as Korean exports.
“It is hard to project the result at the moment,” Park Won-joo, a spokesman for the Trade Ministry, said yesterday in a telephone interview with the Korea JoongAng Daily. “Even if today’s session is well concluded, it is highly likely that the result will be announced [today] by the Blue House.”
China is currently both the largest export and import market for Korea. Last year, Korea exported $141.3 billion worth of goods to China, which accounted for as much as 26 percent of its total export volume, according to data from the Korea International Trade Association. Korea’s exports to the United States stood at $60.1 billion last year, while those to the European Union posted $47.3 billion.
The country imported $80.8 billion worth Chinese goods, outstripping those of other countries.
If the FTA with China takes effect, about 90 percent of all Korean and Chinese goods currently being traded will be free of tariffs immediately or within 20 years. According to forecasts by the Ministry of Strategy and Finance, the Korea-China FTA is projected to help Korea’s gross domestic product grow by 0.95 percent, to 1.25 percent in the next five years. It will also help in creating as many as 240,000 new jobs.
BY SONG SU-HYUN [email@example.com]