Final Agreement of Korea & Chile FTA

As the first Free Trade Agreement, Korea and Chile finally reached the Free Trade Agreement (FTA) after three years of negotiation.

The government officially announced that Korea-Chile FTA was finally made as both of countries agreed upon remaining issues such as a finance service and investment problem on October 24.

The government held the economic ministers` meeting under superintendent of Jeon Yun-Cheol, the Deputy Premier and the ministry of finance & economy, and decided to accept the Chile`s request that the finance service and investment problem will be excluded in this Agreement, but will be discussed after 4 years.

Korea and Chile agreed to contain the agreement and the offer in CD and exchange it exchange. Then, two countries agreed to make a provisional signature to confirm the final result. The agreement is scheduled to be effective in the first half of next year after receiving a procedure of the ministry of government administration and ratification of the National Assembly.

According to the offer agreed by two countries, two white electric appliances such as a washing machine and refrigerator were excluded instead of taking out a pear, apple and rice from the Agreement. There will be the low tariff on grape by applying the seasonal tariffs between November and April,

The tariff is immediately removed on car, truck, mobile phone and computer out of industrial products. The tariff will be removed on motorcar parts and petrochemicals.

The tariff on agricultural products such as paper, garlic, onion and dairy products will be discussed after the Agreement of DDA is completed.

In terms of marine products which are the major exporting goods of Chile, the tariff-free period will be delayed to maximum 10 years on sensitive items such as skate and sardine.

Through the Agreement, Korea can secure an economic bridgehead for launching into Central and South America and will accelerate a progress of FTA with other countries.

However, in the negotiation process, it is shown that Korea has a big problem on negotiation in the finance service and investment section.

Besides, the farmers` organization such as Korean Advanced Farmers Federation repelled the results of negotiation strongly through large objection gathering and movement. The economic organization welcomed this Agreement.