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Forming a Cross-Regional Partnership: The South Korea–Chile FTA and Its Implications

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Cross Regional Trade Agreements

Part of the book series: The Political Economy of the Asia Pacific ((PEAP))

As noted in the lead chapter of this volume, South Korea is not the only country in East Asia which is belatedly attempting to catch up with the global trend of free trade agreements (FTAs). Yet the rise of South Korea’s FTA initiatives – particularly its appetite for cross-regional trade agreements (CRTAs) – is truly dramatic in its speed and enthusiasm, thereby offering fertile grounds for testing the hypotheses developed in the introduction by Solís and Katada.

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References

  1. East Asian countries’ interest in regionalism has surged dramatically at the turn of the new millennium. In East Asia, the shift toward alternatives to the General Agreement on Tariffs and Trade (GATT)/World Trade Organisation (WTO) and the Asia-Pacific Economic Cooperation (APEC) took its most pronounced turn with the conclusion of Japan’s first post-World War II bilateral FTA, the Japan–Singapore Economic Partnership Agreement (EPA). Other East Asian countries, traditionally loyal supporters and beneficiaries of post-war multilateral trading regimes, are also actively weaving a web of bilateral FTAs, targeting countries both within and outside the region in hopes of securing access to much-needed export markets. See Vinod K. Aggarwal and Min Gyo Koo, “The Evolution and Implications of Bilateral Trade Agreements in the Asia-Pacific”, in Vinod K. Aggarwal and Shujiro Urata, eds., Bilateral Trade Agreements in the Asia-Pacific: Origins, Evolution, and Implications (London: Routledge, 2006).

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  28. We thank an anonymous reviewer for this point.

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  30. For instance, one study estimated that economic gains for South Korea from an FTA with Chile would amount to approximately $950 million, or an additional GDP growth of 0.2% every year, and reported an estimated economic of approximately $10 million, or an additional GDP growth of yearly 0.02% for Chile (Cheong, “Han-Chile FTA”, pp. 123–130).

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  60. The OMT’s neoliberal policy orientation has been further highlighted by the appointment of its third trade minister, Kim Hyun-Chong, in July 2004 as well as the promotion of its first trade minister Han Duk-soo (1998–2004) to deputy prime minister and minister of finance and economy. The OMT’s authority has been expanded as indicated by the abolition of the Foreign Economic Council under the Presidential Committee for National Economy in early 2006 after its operation as a monitoring body for the past two years. In addition, a presidential committee to facilitate a KORUS FTA and to win over its opponents was set up in August 2006 under the leadership of the former OMT minister and the former deputy prime minister Han Duk-soo, who is most likely to shield the OMT from its critics. For more details, see Lee and Koo, “South Korea’s Multi-Track FTA Strategy”, pp. 25–26.

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  62. As noted above, South Korea–Japan FTA negotiations have been stalled since November 2004. Meanwhile, the feasibility of a South Korea–China FTA has been studied by private/semi-private research institutions in both countries. The opinion about a South Korea–China FTA is divided in South Korea. From one perspective, a bilateral FTA with China will enhance South Korea’s economic presence with its largest trading partner. From other perspective, potential adverse effects on agricultural and some low-end manufacturing sectors would be much greater than those of prospective FTAs with the US and Japan.

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  65. It should be noted that the South Korea–ASEAN agreement is not yet complete. Thailand backed out of the deal because of South Korea’s persistent demand to exclude rice from the list of items for market liberalization.

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Authors and Affiliations

  1. Graduate School of International Studies, Korea University, Korea

    S. -H. Park

  2. Yonsei University, Korea

    M. G. Koo

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Editors and Affiliations

  1. University of Southern California, 3518 Trousdale Parkway, 90089, Los Angelos, CA, USA

    Saori N. Katada

  2. American University, 4400 Massachussetts Ave, Washington, DC, USA

    Mireya Solís

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Park, S.H., Koo, M.G. (2008). Forming a Cross-Regional Partnership: The South Korea–Chile FTA and Its Implications. In: Katada, S.N., Solís, M. (eds) Cross Regional Trade Agreements. The Political Economy of the Asia Pacific. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-79327-4_2

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