Finance Minister Hong Nam-ki speaks during a meeting on external economic policies held at the government complex in Sejong, Monday. (Yonhap)
The South Korean government will actively consider joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP, and improve systems to engage in the new global trading order evolving in the region, its fiscal chief said Monday.
Stressing that megasized free trade pacts such as the Asia-Pacific agreement will become foundations for changes in the global economic order, Finance Minister Hong Nam-ki said the government will begin unofficial talks with member countries.
Currently, the CPTPP is composed of 11 countries, including Japan, Mexico, Australia, Canada, Singapore and Vietnam. The countries’ combined gross domestic product accounts for 13.4 percent of the world‘s total, or approximately $13.5 trillion.
The top economic policymaker said the country will examine sanitary and phytosanitary measures, fisheries subsidies, digital trade and guidelines related to state-run enterprises in order to meet the requirements that the CPTPP has suggested.
Seoul did not join talks led by the US to create a trading bloc, initially called the Trans-Pacific Partnership. Washington, however, bolted from the pact finalized in 2015 after President Donald Trump took office in early 2017. But it has since been apparently reconsidering its stance if certain conditions are met.
“This is a must-go path to advance the domestic trade system to meet international norms and to respond to the acceleration of the post-COVID-19 digital economy,” said Hong at a meeting to discuss external economic policies.
In November last year, Asia‘s fourth-largest economy signed the China-led Regional Comprehensive Economic Partnership that involves the 10 members of the Association of Southeast Asian Nations as well as South Korea, China, Japan, Australia and New Zealand. It is the world‘s largest trading bloc, covering nearly a third of the global economy.
So far, South Korea has implemented 17 free trade agreements involving 56 countries, including the latest deal with the United Kingdom that came into effect Jan. 1, according to the Ministry of Trade, Industry and Energy.
“Under a vision to have a free trade network to cover around 90 percent of the world’s combined GDP, we will actively pursue more agreements,” he said.
Changes in the global trading environment would be among the factors that will bring the global economy to a “structural infection point,” along with the level of economic recovery that the world could achieve, the transition to the digital economy and response to climate change, the Finance Ministry said.
For positive external factors on the global economy, Hong pointed to the rollout of COVID-19 vaccines and treatment, global economic stimulus measures and the expectation that the US will turn back to multilateral trading under a Joe Biden administration.
By Park Han-na (email@example.com