Korea-EU FTA Could Happen Within the Year

“Signing a FTA with the EU within this year is not impossible.”

This is the answer stated by Kim Han-soo, Korea’s chief negotiator, when asked about the pace of the negotiations. The second round of talks over a free trade agreement with the EU, which was held from July 16 to July 20, just wrapped up in Brussels, Belgium.

However, contrary to its softer position in the first round of the talks, the EU this time around is expressing complaints about Korea’s suggestion on product concessions and placing various demands in areas such as intellectual property rights (IPR), signaling that upcoming negotiations will be anything but smooth.

Little Agreement Made Over Product Concessions and IPRs-

During this round of talks, the two sides shared opinions and made their demands clear regarding product concessions. In addition, substantial progress has been made in the areas of trade remedy, anti-dumping and financial services.

Over the trade remedy issue, the two groups agreed on invoking bilateral as well as temporary safe guards. They also saw eye to eye on how to invoke those safeguards and how long to carry them out.

To speed up the negotiation process, the two groups are intent on making an agreement rapidly in the less controversial areas and later focusing on contentious areas such as automobiles and IPRs.

However, the two sides revealed big differences over the general timetable of market opening. The EU pointed out that Korea’s product concessions are “too conservative” while Korea said, “The two sides have a similar concession level only if the areas currently under tariffs are compared.”

The EU has pressured Korea, demanding unfamiliar systems in IPR protection, such as Public Performance Compensation Rights and Artist`s Resale Right. Over the Gaesong Industrial Complex and other issues of which Korea has great interest, little progress has been made.

Negotiations Progressing More Quickly than Korea-U.S. FTA Negotiations-

Chief negotiator Kim evaluated, “Since the EU is very eager to sign an agreement and both sides have few highly sensitive issues, negotiations are proceeding more smoothly compared to the second round of Korea-U.S. FTA talks in various areas including product concessions, sanitary quarantine and government procurement.”

The two sides agreed to exchange revised product concession arrangements prior to the third round of talks. In order to make negotiations easier, they also agreed not to link tariff elimination to non-tariff barriers.

The third round of talks is scheduled from September 17 to September 21 in Brussels, while Seoul will host the fourth round in mid October.

jarrett@donga.com