South Korea ratifies new FTA with China

Legislation | | MIC Customs Solutions |

South Korea has signed off on the implementation of a new free trade agreement with China.

South Korea's National Assembly has given the green light to a new free trade agreement with China, one of its most important international trading partners.

The new FTA is expected to become effective in December, following completion of the required administrative procedures in both countries, and is expected to lead to tariff reductions amounting to 1.5 trillion won (£863.16 million).

Rival political parties in Korea had been arguing over the potential impact the FTA could have on the country's agricultural and fisheries industries, but the government has assuaged these fears by agreeing to allocate 1 trillion won to support these sectors.

Under the FTA, the export tariff on 958 products will be eliminated immediately, with staggered reductions of other tariffs taking place over the next two decades.

If the deal becomes effective by the end of this year, the first round of tariff cuts would apply straight away and a second round of reductions would follow at the start of 2016.

Korean deputy trade minister Woo Tae-hee said: "The government plans to wrap up the domestic administrative procedure within 20 days."