Korea mulls entering new Pacific trade pactKorea will decide whether to join a fledgling Pacific trade pact within the year after looking into its impact on the national economy and consulting with member states, the Ministry of Trade, Industry and Energy said Thursday.
A year after U.S. President Donald Trump abandoned the Trans-Pacific Partnership, the 11 remaining states on Thursday signed a revamped deal, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, in Chile.
The agreement aimed at slashing tariffs on goods will come into force after it is fully ratified by six of the 11 members, which include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
The countries represent 13.5 percent of global gross domestic product, a total of $10 trillion.
The Trade Ministry said the new pact would have a very limited impact on the national economy in the short term considering the schedule of its implementation. It plans to make a decision on whether to join the pact.
“Korea has already struck bilateral trade agreements with nine nations among the 11 member states, with the exception of Japan and Mexico,” the ministry said. “Even if the pact takes effect, its negative effect on the Korean economy will be very limited.”
Korea has been in preliminary negotiations to participate as an associate member in the Pacific Alliance trade bloc composed of Mexico, Chile, Peru and Colombia.
For Seoul, an associate membership in the alliance could be similar in effect to a trade pact with Mexico.
Korea has already signed free trade agreements with Chile, Peru and Colombia but has yet to do the same with Mexico, which is the largest economy in the alliance.
Seoul will also open talks on forging a trade pact with Mercosur, South America’s leading trading bloc comprising Brazil, Argentina, Paraguay and Uruguay, in the first half of this year.
The bloc’s combined market encompasses more than 290 million people and accounts for $2.7 trillion or more than three-quarters of the economic activity on the southern continent, according to ministry data.