Korea, China, Japan agree to start joint study on FTA

Korea, China and Japan have agreed to start a joint feasibility study for a trilateral free-trade agreement, a high-ranking official from the Chinese Ministry of Commerce said yesterday.

"The governments of China, Japan and Korea agreed to begin feasibility studies on the business, government and academic front in order to seal an FTA as soon as possible," Lu Kejian, director of the ministry`s Department of Asian Affairs, was quoted as saying by the Yonhap news agency.

The consensus among the three regional neighbors was reached during their annual trilateral summit held on the sidelines of the ASEAN+3 meeting in Beijing on Saturday. The three-way meeting has taken place annually since 1999.

"The three countries have agreed to start a joint FTA feasibility study, but a specific timeframe has not yet been set," Kim Jong-hoon, Korea`s Trade Ministry, was quoted as saying by Yonhap News.

While all three countries acknowledge the need for widening and easing trade, but it seems that realizing of an FTA is easier said than done.



Korea and China have been gauging the potential of a bilateral free-trade pact since 2000, however, at the private level through a joint study conducted by the Korea Institute for International Economic Policy and its Chinese counterpart.

China is Korea`s No. 1 trade partner, with Korea standing as China`s third-largest trade partner. Official Chinese data show that two-way trade reached $168.3 billion in 2008, a 26-fold increase from 1992 when the figure stood at $6.37 billion.

Japan and Korea, on the other hand, have already begun negotiations for a bilateral FTA. Negotiations that started in December 2003, however, have been hampered by Japan`s objection to liberalizing its agriculture and fisheries markets and Korea`s reluctance to further open its auto market. The two sides conducted six rounds of talks up until November 2004.

The latest summit agreement at the head-of-state level, however, underscores the strategic benefits of an FTA pact among the three leading regional economies, despite the required perseverance to see a successful conclusion.

Most economists say a trilateral FTA would require a long time and that all three sides would have to take account of their position in light of the regional blocs.

(sohjung@heraldm.com)



By Yoo Soh-jung