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The Korean government officially decided to begin negotiations on a free trade agreement with the European Union in a meeting of government officials presided over by Finance Minister Kwon O-kyu on Tuesday. The EU is also ready to begin talks, following an April 23 External Relations Committee meeting in Luxembourg in which member countries unanimously approved negotiating mandates for the trade pact.
Now that the preliminary work is finished, both sides will officially announce the start of FTA talks at the Ministry of Foreign Affairs and Trade on Sunday. The first round of talks will be held at the Shilla Hotel in Seoul from May 7 to 11.
The negotiations will progress in four sections: goods; services and investment; regulations binding government supply, intellectual property rights, and competition policies; solving conflicts, general provisions, labor, and the environment. Korean Trade Minister Kim Hyun-chong and EU Trade Commissioner Peter Mandelson will head each delegation.
The EU is Korea's second-largest trading partner after China, with bilateral trade amounting to US$79.4 billion last year. The bloc accounts for 12.5 percent of Korea's total foreign trade. At $13.5 trillion, EU's gross domestic product is larger than that of the U.S. at $12.5 trillion.
"The average tariff rate in the EU is 4.2 percent, which is larger than the 3.7 percent in the U.S., and a relatively higher tariff is levied on major Korean exports such as automobiles, textiles and electronics," a Trade Ministry official said. "The abolishment of tariffs through an FTA will be of great significance."
For Korea, the trade pact with the EU should boost exports of autos, video devices, tires, and mobile phones, while the EU would like to see increased exports of large autos, precision machinery, and chemicals. The EU is also expected to aggressively push for opening up the legal services market, a new drug pricing structure, and better protection of intellectual property rights.
A Trade Ministry official said the discussions will happen over five or six official rounds this year.
(englishnews@chosun.com )
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