Seoul, Brussels report `significant progress` on free trade negotiations

(ATTN: CHANGES lead; ADDS more details in paras 4-5, 7-8)
SEOUL, Jan. 20 (Yonhap) -- South Korea and the European Union (EU) have made
'significant' progress in their negotiations for a free trade accord, but more
talks are necessary to seal a deal, trade ministers from both sides said Tuesday.
Since signing a free trade agreement (FTA) with the United States in 2007, South
Korea has held seven rounds of negotiations with the EU in a bid to gain greater
footing in the 27-nation economic bloc, South Korea's second-largest trading
partner after China.
"We confirmed that we have made significant progress during this week's talks,"
South Korean Trade Minister Kim Jong-hoon said in a conference after ending two
days of negotiation in Seoul with his EU counterpart Catherine Ashton.
Kim said both sides agreed to hold an eighth round of negotiations in Seoul in
the first week of March predicting that it may be the last before an agreement is
reached.
Seoul wants to finalize a free trade accord with the EU within the first quarter
of the year with hopes that the deal would implemented early next year.
Though he declined to comment on which issues remain unresolved, Kim said both
sides did make significant progress in such areas as auto trade and rules of
origin. "But further talks are needed to finalize the deal," he said.
Ashton also echoed such sentiment, saying the free trade accord is a high
priority for the EU.
"It is true that we have made significant progress," she said. "We have issues to
be addressed that are inevitably complex and complicated. It's difficult to go to
the details about the negotiations, but our principle is to develop and support
our business and the economy."
The negotiations have made little headway as both sides have been reluctant to
accept the other's demands on tariff reductions, rules of origin, auto trade and
auto-related technical standards.
Bilateral trade came to US$93.07 billion in 2007 and some unofficial studies
suggest an FTA would boost that figure by as much as 40 percent in the long run.
The EU is also the largest foreign investor in South Korea, with outstanding
investment reaching $43.40 billion at the end of 2007.
South Korea is seeking to sign FTAs with as many countries as possible in an
effort to strengthen its export-oriented economy. Currently, South Korea has FTAs
with Chile, Singapore and the European Free Trade Association, as well as a
partial pact with the Association of Southeast Asian Nations.
Seoul is also seeking similar trade deals with Canada, India and Mexico.
sam@yna.co.kr
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