December 07, 2010 11:07
Korea has now signed free trade agreements with 19 countries following a revised agreement reached with the U.S. Mexico and Chile are the only other countries that have signed FTAs with both the U.S. and European Union, which together account for more than half of global GDP, but Korea is the first major industrialized nation.
The Korea-EU FTA will take effect in July of next year following ratification by the National Assembly, and the FTA with the U.S. is expected to go into effect on Jan. 1, 2012.
Korea has now gained a firm lead in terms of FTAs at a time when efforts to scrap tariffs on the World Trade Organization level are facing delays due to disagreements between advanced and developing countries. Once the pacts with the U.S. and EU go into effect, Korean products will benefit from lower tariffs than those exported by their Japanese and Chinese rivals and gain greater market shares.
Korea's FTA with India, a major emerging economy, already went into effect in January. It is also pursuing pacts with Japan and China. Negotiations with China will begin next year, while FTA talks with Japan, which began at the end of 2003 but were halted eight months later, are expected to resume next year. If Korea signs them, it will have abolished tariffs in trade with countries accounting for 75 percent of the world's GDP, turning them into one huge market for Korean products.
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