Countries and regions
The EU-South Korea Free Trade Agreement (FTA)entered into force in July 2011. It is the first of a new generation of FTAs. It goes further than any previous agreements in lifting trade barriers and it is also the EU's first trade deal with an Asian country.
- The agreement eliminates duties for industrial and agricultural goods in a progressive, step-by-step approach. The majority of import duties were removed already when the FTA entered into force on 1 July 2011. On 1 July 2016, import duties will be eliminated on all products except for a limited number of agricultural products.
- In addition to eliminating duties on nearly all trade in goods, the FTA addresses non-tariff barriers to trade with specific focus on the automotive, pharmaceuticals, medical devices and electronics sectors.
- The agreement also creates new opportunities for market access in services and investments, and includes provisions in areas such as competition policy, government procurement, intellectual property rights, transparency in regulation and sustainable development.
The agreement was amended in 2014 to also allow Croatia to benefit from the same preferences as the other 27 EU Member States since its date of accession to the EU on 1 July 2013. This amendment was needed because Croatia was not member of the EU when the agreement was signed in 2010.
- The EU and South Korea are important trading partners. South Korea is the EU's tenth largest export destination, whereas the EU is South Korea's fourth export destination (after China, Japan and the US).
- In 2013, EU exports of goods to South Korea amounted to 40 billion EUR, whereas imports from South Korea totaled 35.8 billion EUR. In terms of EU exports, the most important categories of products are machinery and appliances, transport equipment and chemical products. As far as EU imports from South Korea are concerned, the main product categories are machinery and appliances, transport equipment and plastics.
- The EU records a significant surplus in trade in services with South Korea. In 2012 EU exports of services to South Korea amounted to 9.6 billion EUR, compared to imports of 4.6 billon EUR.
- South Korean investments in the EU have increased substantially from 13.1 billion EUR in 2010 to 18.5 billion EUR in 2012, representing 0.5% of the total inward foreign direct investment (FDI) in the EU. Over the same period, EU investments in South Korea increased moderately from 37.5 to 39.5 billion EUR, representing 34.5% of the total FDI in South Korea.
EU-South Korea "trade in goods" statistics
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EU-South Korea "trade in services" statistics
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Foreign direct investment
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EU and South Korea
Impact of the Free Trade Agreement
1 July 2014 marked the 3rd anniversary of the EU-South Korea FTA. Comparing figures between the third year of the FTA being implemented with the year before the entry into force of it, we see that:
- EU exports to South Korea of goods increased by 35% from 30.6 billion EUR to 41.5 billion EUR. EU exports of fully liberalised goods increased by 46%.
- EU imports from South Korea totaled 37.9 billion EUR and thus remained almost at the same level as in the year before the FTA entered into force. , The main reason for the weaker performance of the imports from South Korea was the decreased demand in the EU due to the financial crisis. However, in the third year of FTA implementation South Korean imports increased by 6% compared to the previous year.
- Imports of fully liberalised goods from South Korean increased by 21%. This gives a clear indication that the FTA has worked well also for South Korea.
As a result, the EU’s trade deficit with South Korea turned into a trade surplus of 3.6 billion EUR . In addition, the EU’s share in South Korea’s total imports from the world increased from 9% to 11%.The current level of EU exports would have generated duty payments of 1.6 billion EUR had the FTA not been in force.
The agreement marked a new era in the EU-South Korea trade relations. It is important to create the right conditions for exporters to reap the benefits they expect from it. Thus continued attention is paid on the implementation of the agreement.
The agreement established a significant number of specialised committees and working groups between the two parties to monitor its implementation. These bodies also provide an opportunity to seek resolutions to market access concerns and to engage in closer regulatory cooperation. The annual Trade Committee at ministerial level plays a supervisory role and is designed to ensure that the agreement operates properly.
More on the operation of the agreement in practice.
Since the entry into force of the FTA in July 2011, the European Commission is monitoring closely the imports to and from South Korea in sensitive sectors.
- Every two months, the Commission presents a monitoring report to the EU Member States, the European Parliament and the relevant industry associations on the evolution of imports of textiles, consumer electronics and cars (including monthly statistics ).
- Every year, the Commission presents a monitoring report to the European Parliament and the Council.
Since 2010, the EU and South Korea have upgraded their relationship to a Strategic Partnership, ensuring a high level of commitment from both sides. A Framework Agreement was signed on 10 May 2010 and entered into force on 1 June 2014. It provides a basis for strengthened cooperation, including on major political and global issues such as human rights, non-proliferation of weapons of mass destruction, counter-terrorism, as well as climate change and energy security. This is an overarching political cooperation agreement with a legal link to the EU-South Korea Free Trade Agreement
An Agreement on Co-operation and Mutual Administrative Assistance in Customs Matters has been in force since 1997.
The EU has established a permanent forum for consultation, to allow for the EU and South Korea to share experiences and views on competition policy, as well as share non-confidential information on competition law enforcement with South Korea.
A more specific cooperation agreement concerning cooperation on anti-competitive activities also exists. This agreement was signed by the EU and South Korea on 23 May 2009 and entered into force on 1 July 2009.
More information on the EU-Korea FTA
EU–Korea FTA : EMC and electric safety certification.
A User guide for electromagnetic compatibility (EMC) and electric safety certification. The EU–Korea FTA establishes a regime that eases certification procedures for electrical and electronic products.
- Fact sheet: EU-South Korea FTA: a quick reading guide
- Fact sheet: 10 key benefits of the EU-South Korea FTA
- For practical information concerning the application of the FTA, please consult the Market Access Data Base.
- Stakeholders can send enquiries concerning the implementation of the EU-South Korea FTA via an online enquiry form.
- Annual Report on the Implementation of the EU-Korea Free Trade Agreement
- Graphs: Monitoring in the sensitive sectors
Trading with South Korea
- Rules and requirements for trading with South Korea
- Importing into the EU from South Korea
- EU trade defence measures on imports from South Korea
- Exporting from the EU to South Korea
- The EU is present on the ground in South Korea
- Trade relations are part of the EU's overall political and economic relations with South Korea
- South Korea is a member of the World Trade Organisation