The resurgence of COVID-19 in South Korea and around the globe has not stopped diplomatic efforts to shore up a post-pandemic economy.
Despite having to undergo COVID-19 testing three times -- in Santiago, Chile; in Abu Dhabi, United Arab Emirates; and again in Incheon -- Rodrigo Yanez, Chile’s vice trade minister, recently visited Korea, the country’s fifth-largest trading partner and its first Asian partner in a free trade agreement.
“Trade, as you know, will be the driver for the economic recovery,” he said in a written interview with The Korea Herald during his visit to Korea from Aug. 25-30. “Today, more than ever, we need to join forces to fight the pandemic, but also to fight any attacks on free trade and to oppose protectionism.”
To that end, Chile is seeking to renegotiate its trade pact with Korea, which Yanez said has “built a very good basis” but still has “room for improvement.”
The Korea-Chile Free Trade Agreement came into force in 2004 and spurred nearly a fourfold increase in bilateral trade.
In 2018, the bilateral trade volume amounted to more than $6.2 billion, with Korea‘s imports from Chile reaching $4.5 billion. The bilateral trade volume in 2019 was $5.2 billion, according to Korea Customs Service.
“When Chileans think about Korea they think about cars and technology which have helped enhance our life quality. We hope that Koreans also think of Chilean products such as salmon, fresh fruits and wine as contributors to a better health and quality of their lives,” he said.
Korea mostly imports copper from Chile, the world’s top copper producer. Chilean food items such as wine, pork and fresh fruits are also gaining popularity here.
More than ever, “modernizing” the FTA to reflect the changing times is vital, Yanez said.
Korea and Chile agreed to start negotiations to update the FTA in 2016 and conducted three rounds of negotiations in 2018 and 2019, but the COVID-19 situation interrupted the process.
“We deeply believe that our bilateral enhancement negotiations provide an opportunity to achieve an ambitious outcome in our trade relationship, especially in the areas of market access, trade facilitation, labor, environment, gender and intellectual property,” he said.
For Yanez, who has served as the Chilean foreign minister’s point man on trade since July 2019, Korea was one of the first overseas destinations for a diplomatic mission since the coronavirus outbreak.
During his six-day visit, he met with senior Korean officials including Trade Minister Yoo Myung-hee, Second Vice Foreign Minister Lee Tae-ho and Vice Science and Second ICT Minister Jang Seok-young, as well as Korean executives from leading companies such as KT.
This was in line with what President Moon Jae-in and President Sebastian Pinera discussed in September 2018, when they met for the first time in New York City on the sidelines of the UN General Assembly. The two leaders agreed on four priority areas in the bilateral relationship: e-government, cybersecurity, the “fourth industrial revolution” and cooperation on climate change.
Witnessing the fast-paced digital transformation accelerated by the pandemic, Chile is taking the health crisis as an opportunity to diversify and expand exports and markets to make its trade more resilient, he said.
In this regard, Chile seeks to cooperate with Korea to advance the digital economy and e-commerce.
“Considering the development in Korea on digital economy, Chile looks forward to cooperating with Korea and proposes to organize a virtual meeting between our technical experts to identify opportunities and possibly establish a roadmap for bilateral work in this area,” he said.
In June, Chile, Singapore and New Zealand signed the Digital Economy Partnership Agreement, the first pact of its kind, representing a new form of economic engagement and trade in the digital era. It aims to facilitate digital trade, promote interoperability among systems in different countries and address the new issues brought about by digitalization.
Yanez also said Chile had strongly supported Korea’s bid to become an associate member of the Pacific Alliance -- a trade bloc comprising Chile, Colombia, Peru and Mexico.