Korea to 'swiftly' commence talks with ASEAN to improve existing FTA: ministry
President Lee Jae Myung speaks during a summit involving Korea and the Association of Southeast Asian Nations in Kuala Lumpur, Monday. Yonhap
Korea will "swiftly" commence talks with the Association of Southeast Asian Nations (ASEAN) to discuss upgrading the free trade agreement (FTA) the two sides signed nearly 20 years ago, as part of efforts to expand their bilateral trade, the industry ministry said Monday.
The Ministry of Trade, Industry and Resources unveiled the plan as President Lee Jae Myung wrapped up his two-day trip to Malaysia for the annual Korea-ASEAN summit, where he proposed launching negotiations to improve the FTA with a goal of reaching US$300 billion in annual trade volume between the two sides by 2029.
Korea and ASEAN signed an FTA on goods in 2006, followed by agreements on services in 2007 and investment in 2009. ASEAN is currently the third-largest trading partner for Korea, with the latter having exported some $114 billion worth of goods to the region last year.
The ministry said the two sides will work to upgrade their FTA to include new trade agenda items, including the digital economy, supply chains and climate change.
Korea will also work to expand various trade agreements, such as FTAs and comprehensive economic partnership agreements, with individual member nations of ASEAN as part of efforts to expand the country's exports of electric vehicles, steel and petrochemical products, the ministry added.
Earlier in the day, Korea signed a bilateral FTA with Malaysia during Lee's visit to the nation, according to the presidential office, marking Seoul's 27th free trade deal.
A joint declaration on the FTA was signed between Trade Minister Yeo Han-koo and Tengku Zafrul Aziz, Malaysia's minister of investment, trade and industry, Seoul's industry ministry said in a separate release.
"Korea will be able to improve its trade conditions with this bilateral FTA (with Malaysia) as it further opens markets for Korea's key export items," Yeo said.
Yeo noted that the fresh deal can also help the country expand cooperation with Kuala Lumpur in future-oriented industries, including the digital economy, clean energy and biohealth.
The FTA with Malaysia further opens the door for Korea's automotive, steel and chemical sectors, complementing the market access already secured under the ASEAN FTA and regional comprehensive economic partnership (RCEP), a trade bloc involving ASEAN, Korea, China, Japan, Australia and New Zealand.
Once it comes into force, the latest FTA with Malaysia will open more than 90 percent of each country's market to the other.
The two countries also plan to implement additional tariff cuts or remove duties on hundreds of products once the deal takes effect.
Malaysia is Korea's third-largest trading partner among ASEAN members and its fourth-largest investment market.
The ministry said Seoul will also join hands with ASEAN to expand RCEP, while expanding their bilateral think tank dialogue on economic and trade issues.
The RCEP is one of the world's biggest free trade agreements, signed by eight ASEAN member nations as well as Korea, China and Japan. The 15 member nations of the RCEP account for around 30 percent of the global gross domestic product, population and trade volume.