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S. Korea, China strike balance in FTA talks: gov't

All Headlines 14:00 November 10, 2014

SEJONG, Nov. 10 (Yonhap) -- The bilateral free trade deal between South Korea and China will equally benefit the two countries as they both obtained what they were looking for, officials here said Monday.

Under the tentatively reached free trade agreement (FTA), South Korea will eliminate its tariffs on 79 percent of all products, or 9,690 items, imported from China within 10 years following the implementation of the deal, according to the Ministry of Trade, Industry and Energy.

Such a schedule compares with that of China, which will eliminate its import duties on 71 percent, or 5,846, of products shipped from South Korea over the same period.

The details of the proposed FTA were released shortly after the two countries announced a de facto final deal in their FTA talks that were first launched in May 2012.

"South Korea will have signed an FTA with all three major economies of the world that include the United States and the European Union once the Korea-China FTA is implemented," the ministry said.

"It will not only help boost the countries' annual bilateral trade volume to over US$300 billion by 2015 but also help bring South Korea's per capita income to over $30,000 by enabling South Korean firms to advance into the Chinese market that is growing at a tremendous speed ahead of, and on relatively better terms, than their global competitors," it added.

A major remaining issue for South Korea was the level of its market liberalization for agricultural and fishery products.

Ministry officials said market opening for agricultural goods under the Korea-China FTA will be minimal when compared to the other major FTAs that South Korea has signed.

Under the China deal, South Korea will eliminate its import tariffs on 40 percent of agricultural and fishery products, in terms of value, shipped from China. The figure compares with 92.5 percent and 98.4 percent under the country's bilateral FTAs with the United States and Australia, respectively, according to the trade ministry.

In addition, 30 percent of all agricultural and fishery products have been permanently excluded from market liberalization in any future negotiations, it added.

"Having 30 percent of goods permanently excluded from market opening is unprecedented in all 12 other FTAs the country has signed, and this also means all key items, including rice, pepper, pork and beef, that have been considered the most sensitive here have been excluded from market liberalization," the ministry said.

Apart from its direct impact on the South Korean economy, the FTA with the world's second-largest economy is expected to help strengthen South Korea's role and status in the international community.

"The Korea-China FTA is expected to become a chance for the country to act as a linchpin between countries in the region as they move to boost their economic cooperation and form an economic bloc in the Asia-Pacific region," the ministry said.


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