Korea seeks to sign free trade deals with over 10 countries in 2023

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Trade Minister Ahn Duk-geun speaks during a meeting at the Seoul Government Complex in Gwanghwamun, Seoul. Yonhap


By Lee Kyung-min

Up to 10 resource-rich countries will sign free trade agreements with Korea, in order to weather the rapidly deteriorating global trade as well as economic conditions, the trade ministry said Wednesday.

“Korea will identify new overseas markets where strong local players will be able to thrive, a priority equally important as leading the global discourse on establishing trade norms,” Trade Minister Ahn Duk-geun said during a meeting at the Seoul Government Complex in Gwanghwamun. “Korea’s strength in manufacturing and economic stability will help draw foreign investments and create growth.”

Korea also seeks to strengthen trade partnerships with over 20 countries this year, as underpinned by the Trade and Investment Promotion Framework (TIPF) whereby bilateral cooperation will be expanded to include not only trade but also supply chain issues.

“The TIPF will concern 20 countries with which Korea has no trade agreement as of yet,” Ahn said. “The new initiative will be pursued with the strengthened FTA partnerships, to best prevent and limit the blowback of uncertainties in trade conditions to best help local exporters.”

Meanwhile, senior officials from 18 ministries attended a meeting, Wednesday, to outline and fine-tune strategies for exports, certain to register a marked drop from a year earlier due to global recession fears, the industry ministry said.

The pan-government consultative body will first and foremost identify sectors showing promise of becoming the next export drivers, including healthcare, sports, tourism, ICT, software and education.

The emerging strong industries are expected to generate export income, which is much needed to further spur the ongoing government initiative to bolster exports by promoting large overseas contracts from nuclear reactor construction and defense.

Further strengthening the need for diversified sources of income is a bleak outlook for Korea’s key manufacturers encompassing semiconductors, steel, petrochemicals and vehicles. The current growth drivers are certain to dwindle in the months to come due to weakening global demand and sales price drops, compounded further by soaring global key commodity prices from Russia’s invasion of Ukraine, the combination of which keeps their production costs elevated.

Also among deteriorating global trade conditions is growing protectionism, as best evidenced by the U.S. Inflation Reduction Act (IRA), which dealt an unexpected heavy blow to Korea’s manufacturers of electric vehicles (EVs) and batteries.

“This year is highly likely to see a global recession sparked by the U.S. and Europe, among other advanced peers of Korea,” Ahn said.

The meeting was presided over by Ahn, the country’s top trade negotiator. In attendance were officials of the industry, finance, education, science, foreign affairs, defense, agriculture, culture and sports, welfare, environment, oceans and land ministries.

The government will strengthen trade finance, mostly by expanding the scope of government guarantees and the volume total eligible for the country’s exporters.

Also fortified will be government-mediated certification and overseas marketing, as well as fostering private investments and human resources management.

The level of preparedness will be increased to better respond to supply chain uncertainties, carbon neutrality, protectionism and nationalism ― a slew of thorny issues oftentimes waged, amplified and dictated in the context of global hegemony.

The industry and welfare ministries held a joint meeting last Dec. 29 to foster the exports of Korea’s key medicine and healthcare systems.

The officials discussed ways to help strong local market players obtain overseas certifications, and better respond to stricter processes of medical device certification in Europe.

The promotion of key cultural content produced by local entertainers and art figures as well as small and medium-sized enterprises (SMEs) will be strengthened reflective of target audience analysis.

Cold-chain, or temperature-controlled supply chain networks, will be established to help improve logistics conditions for the country’s key agricultural and maritime products.