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South Korea

South Korea

The EU-South Korea free trade agreement (FTA) had provisionally applied since July 2011 before it was formally ratified in December 2015.

It went further than any of the EU’s previous agreements in lifting trade barriers, and was also the EU's first trade deal with an Asian country.

 

 

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Trade picture

  • South Korea is the EU's eighth largest export destination for goods, whereas the EU is South Korea's third largest export market.
  • EU exports of goods to South Korea increased by 77% from 2010 to 2018. This turned the EU's trade in goods deficit of €10.5bn in 2010 into broadly balanced trade in 2018.
  • EU exports of services to South Korea increased by 82%, compared to 66% for EU imports from the country, from 2010 to 2017. The EU had a €5.6bn trade in services surplus with South Korea in 2017.
  • Over the same 2010-2017 period, EU inward foreign direct investment (FDI) stocks increased by 112% and EU outward FDI stocks (EU investments in Korea) increased by 39%.
  • The EU’s most significant goods exports to South Korea are machinery and appliances, transport equipment and chemical products.
  • The main EU imports from South Korea are machinery and appliances, transport equipment and plastics.
  • The EU is South Korea's biggest foreign direct investor.

EU-South Korea: Trade in goods

Trade in goods 2017-2019, € billions
Year EU imports EU exports Balance
2017 44.0 43.5 -0.5
2018 46.0 43.7 -2.2
2019 47.4 43.3 -4.0

EU-South Korea: Trade in services

Trade in services 2016-2018, € billions
Year EU imports EU exports Balance
2016 6.5 10.8 4.3
2017 7.1 11.3 4.2
2018 7.6 11.4 3.8

EU-South Korea: Foreign direct investment

Foreign direct investment 2018, € billions
Year Inward stocks Outward stocks Balance
2018 24.9 46.0 21.1

Unless otherwise mentioned “EU” concerns for all indicated years the current European Union of 27 Member States.

Date of retrieval: 22/04/2020

More statistics on South Korea

EU and South Korea

1 July 2019 marked the eighth anniversary of the EU-South Korea FTA. The agreement eliminates duties for industrial and agricultural goods in a progressive, step-by-step manner.

The majority of import duties were removed in 2011. The remaining ones – with the exception of a limited number of agricultural products – were removed after five years on 1 July 2016.

The FTA also addresses non-tariff barriers to trade, specifically in the automotive, pharmaceutical, medical devices and electronics sectors.

The agreement has created 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 established a number of specialised committees and working groups between the two parties to monitor implementation.

These bodies also provide an opportunity to seek resolutions to market access concerns and to engage in closer regulatory cooperation. An 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.

In 2010, the EU and South Korea upgraded their broader relationship to a Strategic Partnership. On 10 May 2010 the two sides signed a Framework Agreement, which entered into force on 1 June 2014. It provides a basis for strengthened cooperation on major political and global issues such as human rights, non-proliferation of weapons of mass destruction, counter-terrorism, climate change and energy security. This is an overarching political cooperation agreement with a legal link to the EU-South Korea Free Trade Agreement.

Committees and Dialogues

The EU and South Korea meet regularly to discuss issues and best practices when applying the agreement. The committees, working groups and other bodies under the agreement meet regularly.

Trading with South Korea