The Ministry of Trade, Industry & Energy announced that South Korean Trade Minister Kim Hyun-chong signed the Korea-Central America FTA in Seoul on February 21 with the trade ministers of Costa Rica, El Salvador, Nicaragua, Honduras and Panama.
The six countries initiated their negotiations in June 2015 and completed the negotiations in 32 months. Each of the governments is going to handle the remaining process, such as parliamentary ratification, so that the FTA can be put into effect in the first half of this year. “The FTA between the two regions will be a chance for them to make their partnership even more comprehensive and strategic,” the South Korean trade minister explained.
According to the South Korean government, the agreement means the liberalization of at least 95% of the bilateral trade between South Korea and the five countries. Based on the FTA, tariffs will be eliminated in a nonlinear way, immediately or over a period of 10 years or so, on primary industry products such as coffee, banana and pineapple as well as manufactured goods like automobiles, auto parts, synthetic resins and cosmetics. Still, concessional exemptions are maintained for some items like rice and chili.
When it comes to cross-border services, the FTA is expected to include highly liberal rules such as most-favored-nation treatment, protection of intellectual property rights, self-certification of origin, and so on.
Before the FTA, in the meantime, the South Korean government signed a memorandum of understanding with Costa Rica for cooperation in trade and investment.