Posted January. 03, 2013 23:10,
Has the Korean government lost its interest in finishing this deal?
Len Edwards, former Canadian ambassador to Korea, asked this question in a Nov. 26 contribution to iPolitics, a Canadian political news and commentary website. In the article Trade talks with Japan, Korea sadly headed in different directions, he urged Seoul to positively proceed with free trade talks with Ottawa. At first sight, the article criticized Koreas passive attitude toward a free trade agreement with Canada, but at a closer glance, it seemed more like courting Seoul to finish the deal.
Edwards, who served as deputy Canadian foreign minister, wrote, Begun in 2005 amid great expectations, what should have been a natural agreement between largely complementary economies has become bogged down on the same two main issues we face with Japan: Canadian access for Korean automotive products and Korean access for Canadian agricultural goods going the other way.
○ Korea, `first-rate` trade partner
Many economies worldwide want to conclude a free trade accord with Korea, which has such agreements with 45 countries including the U.S., the European Union and the eleven-member Association of Southeast Asian Nations, and actively seeks multilateral deals such as a trilateral free trade deal with China and Japan and the Regional Comprehensive Economic Partnership.
Canada, Australia, New Zealand, Mexico and Israel are among nations seeking to conclude free trade deals with Korea. Trade officials and envoys from those countries urge Seoul to positively engage in free trade talks with their countries through media interviews at every opportunity. Seoul`s trade talks with Ottawa, Mexico City, Canberra and Wellington have stalled due to differences over market opening for cars and agricultural products. Korea has yet to initiate negotiations with Israel.
Domestic trade experts interpret Edwards article in the same vein. They say Koreas status has significantly improved in international trade, which is often called a battlefield without gunfire.
Having seen Korea expand its international trade despite the global economic slowdown, many other countries are impatiently seeking to follow suit, judging that it is to their advantage to join the free trade network established by Korea as soon as possible.
The status of Korean trade officials has also been elevated. In the past, they implored their foreign counterparts to begin free trade negotiations, but now can make strategic choices over which countries to negotiate with first.
Economic indexes show the effects of Koreas free trade pacts. According to the Korean Knowledge Economy Ministry on Thursday, the influx of foreign direct investment into Korea reached a record 16.26 billion U.S. dollars last year, up 18.9 percent from the previous year. Of the amounted reported to the Korean government, 10.38 billion dollars was invested in the country last year, up 57.8 percent from 2011 and the highest since 2000.
Foreign direct investment is estimated to create some 100,000 jobs over the next three years, a ministry official said. Foreign investors were affected by increased confidence in the Korean economy following by the initiation of free trade deals with the U.S. and EU as well as upgrades of Koreas sovereign credit rating.
○ Sticking to economic principles
Experts stress that Korea should capitalize on its leadership role in free trade talks to maximize its benefits from negotiations.
Korea now has no reason to be impatient over FTAs. It should engage in trade with other economies in a direction under which it can maximize gains by making thoroughly economic calculations, rather than trying giving beneficial treatments to other countries and hastening to conclude deals, said Jeong In-kyo, an economics professor at Inha University.
Other experts say Korea needs a selection and concentration strategy by focusing much of its energies on concluding a free trade deal with China and Japan while making progress in negotiations with other economies courting Korea.
More bilateral FTAs could result in more export inconvenience because of different rules applied to trade deals, said Kim Hyeong-joo, a researcher at LG Economic Research Institute. It`s more important to enhance the quality of existing FTAs and seeking new types of free trade agreements such as multilateral deals than to blindly increase the number of free trade partners.