Kang Yoon-seung | Yonhap News Agency – Prime Minister Han Duck-soo said Thursday (22 August) that South Korea will push to expand free trade agreements (FTAs) with emerging markets in Asia and Africa to boost the export-driven economy and enhance supply chain resilience.
Han unveiled the trade policy road map during a ministerial meeting to address challenges from the rapidly changing global trade environment and supply chain disruptions.
We will expand the FTA network in major emerging markets, including Asia and Africa, to support local companies’ businesses in their global business efforts.
Han Duck-soo
Han said the government will explore ways to stabilize supply chains of key items through regional trade deals like the Indo-Pacific Economic Framework (IPEF) and bilateral pacts with key partner countries.
We will actively participate in discussions on new trade norms, particularly in areas such as digital and climate, to uncover business opportunities for our companies.
Han Duck-soo
South Korea has signed FTAs with 59 nations, covering 21 agreements, which represents about 85 percent of the world’s gross domestic product.
The government said that it aims to have its free trade portfolio encompass 90 percent of the global GDP by expanding ties with emerging and developing countries, primarily in the southern hemisphere.
As part of the vision, the government will seek to complete the ongoing free trade deal with Mongolia and launch negotiations with Pakistan and Bangladesh to expand its presence in the West Asian market.
South Korea will aim to secure such deals with Tanzania, Kenya and Morocco as well, the trade ministry added.
The country also plans to pursue multilateral trade agreements in the Indo-Pacific region, including resuming talks for a trilateral FTA with China and Japan.
To address supply chain disruptions in the global market, South Korea will utilize multilateral platforms, such as the IPEF, to strengthen its ties with the United States and Japan, the trade ministry said.
The IPEF, a U.S.-led regional trade pact involving 14 nations in the Indo-Pacific, last month appointed South Korea as the chair of a body dedicated to addressing supply chain crises under the agreement.
To counter the looming protectionism policies from major trade partners, South Korea added it will leverage various channels with like-minded countries to mitigate the impact.
The government added it will aim to build dialogue platforms with the United States to promptly reach out to key government and corporate officials in case of a trade issue and swiftly seek consultations.
Based on the improving relationships with Japan, the trade ministry said South Korea will also strive to establish a future-oriented bilateral economic relationship that encompasses industry, trade and energy.
Regarding China, South Korea will seek to build “multilayered relationships” with the top trading partner’s central and regional governments to maintain a stable supply chain.
Han also introduced measures to support e-commerce exporters in entering the global market, including simplifying the customs declaration procedures and expanding customs refunds to boost their price competitiveness.
Source: https://en.yna.co.kr/view/AEN20240822003551315?section=national/politics
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Commentary by Eurasia Baike
Han Duck-soo mentioned his willingness to work within the framework of the Indo-Pacific Economic Framework (IPEF) in order to boost free trade and economic cooperation with developing countries. The IPEF is an economic initiative launched in 2022 by the US and it, copies in broad terms, the Regional Comprehensive Economic Partnership (RCEP) launched by China in 2020.
The fact that the South Korean prime minister clearly omited the Chinese-backed initiative, in which it is a member, shows that government support for the RCEP will be minimal in the future. The IPEF is a political mechanism aimed at restoring US presence in South-East Asia while also promoting economic cooperation of US occupied states like Japan and South Korea with states Washington highlighted as important for it’s regional security arhitecture.