The South Korean government is going to accede to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Initially, 12 countries were planning to form the TPP. However, the United States withdrew from it, and then the remaining 11 countries including Japan signed the CPTPP in March this year. South Korea was not included at that time, and negotiations with the 11 countries are required for South Korea’s accession to the CPTPP.
The South Korean government did not join the agreement as its accession could lead to an increase in trade deficit with Japan. Furthermore, South Korea has already signed bilateral FTAs with nine out of the 11 countries except for Japan and Mexico.
However, the likelihood of the United States’ return to the agreement rose and concerns were expressed over South Korea’s alienation in trade. Under the circumstances, Deputy Prime Minister Kim Dong-yeon remarked in March that the government would make a decision in the first half of this year.
The government conducted studies on economic advantages and disadvantages and the agreement’s possible impact on the local job market, industries, etc.
It has reached a conclusion that accession to the CPTPP would do it more good than harm. It also took into account the fact that Britain and Taiwan are planning to join the CPTPP as well.
Still, the South Korean government is mulling over when to sign it as external uncertainties are growing, including the ongoing trade disputes between the U.S. and China, U.S. economic sanctions on Iran and Turkey, and North Korean denuclearization.
In the meantime, the South Korean government is going to make more efforts for the conclusion of the China-led Regional Comprehensive Economic Partnership (RCEP) before this year’s end. The RCEP is a mega FTA covering about half of the world’s population and its members are 10 ASEAN member countries, South Korea, China, Japan, Australia, New Zealand and India. Unlike the CPTPP, the RCEP requires no accession process as it is yet to be launched.