By Kang Hyun-kyung

The leaders of Korea and Colombia announced early Tuesday morning (KST) that the two countries had finished the negotiations for a free trade agreement (FTA).

The deal needs to be approved by the legislatures of the two countries. The two governments expected the pact will probably go into effect in the first half of next year after approval by their respective parliaments.

The announcement came shortly after President Lee Myung-bak, who is on a trip to North and South American countries, held a summit with President Juan Manuel Santos of Colombia.

The comprehensive accord covers 22 sectors, including commodities, trade, investments, services and intellectual property rights.

The two sides will be able to lift more than 96 percent of tariffs within 10 years if the pact goes into effect.

Trade Minister Bark Tae-ho who accompanied President Lee told reporters that the trade deal will further open the door to Latin American markets.

“South Korea will export commodities to Colombia, while importing raw materials and natural resources. The two economies are complimentary,” he said.

It has taken two and a half years for the two countries to strike the deal. Beef was a major stumbling block, according to those who are familiar with the negotiations.

The effectuation of the pact, analysts say, will have South Korean cattle raisers inevitably suffer as the country will import cheap Colombian beef. South Korea agreed to import boneless beef cuts during the tough negotiations.

But Trade Minister Bark tackled this, saying the negative effect was, to some degree, exaggerated.

Bark said first of all, South Korea toughened customs regulations during the negotiations. He also emphasized that the 19-year period until tariffs are to be completely abolished is long enough for cattle farmers here to brace for the possible negative fallout on their income.

The trade minister noted Colombia is not a major beef exporter.

South Korea currently imports most beef from Australia and the United States.

Rice, one of the sensitive areas for South Korean farmers, was not included in the trade accord.

Trade experts predicted bilateral trade will soar if the deal takes effect after the parliaments of the two countries ratify it.

Last year, bilateral trade hit approximately $2 billion, a sharp increase from 2006 when it marked only $1.1 billion.

Colombia is the fourth largest economy, as well as the third most populated country in Latin America. It was the only country that sent troops to South Korea during the Korean War (1950-53).

South Korea has signed the free trade agreement with several nations including the United States, the European Union and Chile.