China-ROK FTA Negotiations Completed, FTA Initialed

Chinese Ministry of Commerce on the 25th announced, China and South Korea completed the initialed text of FTA, and confirmed the content of the agreement. So far, China and South Korea free trade negotiations has been completed.

The Commerce Department said China-ROK FTA negotiations started in May 2012 and the substantive negotiations finished in Beijing in November 2014. China and South Korea FTA is by far the biggest trade involving the country, the most comprehensive range of areas. ROK said that in all the FTA signed between South Korea and other countries, ROK FTA has the largest number of the tariff preference objects. The two countries agreed to sign a formal agreement in the first half of this year.

Under the regulations, in 20 years at most, China’s zero-tariff goods will reach 91% of tariff lines, 85% of imports, the Korean zero-tariff goods will reach 92% of tariff lines, 91% of imports. China will reduce the tariffs of the rice cookers, washing machines, refrigerators, medical equipment, appliance parts and other products to zero. South Korea will phase out the tariffs of motors and transformers, and phase out the tariffs of the handbags, golf clubs and other large household items imported from China in 15-20 years.

In manufacturing, automobiles and spare parts are not included in the tariff reduction or the object of long-term realization of the trade liberalization. In the field of Agriculture & Fisheries, Korean rice, pepper, garlic and squid, octopus and other aquatic projects are not included in the tariff reduction target.

There are many procedures to be done to make China-ROK FTA come into force. First, both sides need to translate the agreement into their own languages. China-ROK FTA text and list of tax cuts add up to 1077 pages, it will take a long time to translate them. After the translation work is completed, a series of domestic ratification procedures will be needed, and then both countries signed the English and the native language drafting agreements. South Korean media reported that the South Korean government planned to formally sign the agreement in the first half of this year. Finally, the FTA also needs to be approved by Congress, if it goes on smoothly, China-ROK FTA is expected to come into effect this year. (www.chinainout.com)