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(LEAD) FTA with China to reverse faltering exports: PM

All News 16:29 March 03, 2016

(ATTN: CHANGES lead, headline; ADDS more information throughout, photo)

SEOUL, March 3 (Yonhap) -- Prime Minister Hwang Kyo-ahn said Thursday a bilateral trade pact with China could reverse South Korea's faltering exports.

"The government is pushing for the number of policies aimed at recovering the pace of exports to China such as by helping South Korean companies utilize the Korea-China free trade agreement (FTA)," said Hwang.

The bilateral trade agreement came into effect in December last year.

The remark was made during a meeting with eight company executives doing business in China and related government officials at the prime minister's official residence.

"I hope the businessmen here today will make the most of the government's efforts to assist businesses with policies aimed at capitalizing on the bilateral free trade agreement," he added.

Hwang noted the country's outbound shipments stalled due to a combination of factors ranging from a drop in oil prices to a slowdown in the Chinese economy.

According to government data, South Korea's trade with China, its No. 1 trading partner, has been on the decline for the past three years. In 2014, the total volume of exports to China dipped 0.4 percent on-year with the pace accelerating to a 5.6-percent drop the following year.

Hwang said the government will nurture the consumer goods industry, such as the cosmetic and baby goods production sector, with its high potential to excel in the Chinese market. This, it said, could help the country diversify export items.

Among policy plans announced by Hwang, the government will increase the number of companies designated as export-driven ones to 5,000 from the current 1,000 to help them expand their businesses in China.

As of February, Asia's fourth largest economy posted 14 straight months of minus export growth.

In February of this year, outbound shipments to China were down 12.9 percent compared to the same period last year.

Hwang has held meetings with various business representatives regularly since taking office in June 2015 to discuss measures to revive the economy.


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