Korea and Canada reached terms for a free trade agreement on Tuesday, ending more than eight years of negotiations. Canada becomes Korea's 12th FTA partner, and Korea Canada's first East Asian signatory.
Korean cars are expected to be the biggest beneficiaries of the trade pact since Canada agreed to scrap its 6.1-percent tariff on imported cars within two years.
Automobiles account for 43 percent of Korea's exports to Canada. Hyundai and affiliate Kia produced around 60 percent of their exports to Canada here last year. Once the tariffs are scrapped, Hyundai's Tucson small SUV is expected to cost US$800 less in Canada.
But imports of Canadian agricultural products are expected to impact Korean farmers. Canadian beef will be tariff-free here around 2030.
Trade Minister Yoon Sang-jick and his Canadian counterpart Ed Fast concluded the terms in Seoul. It will go into effect early next year following ratification by lawmakers.