With the signing of the Economic Cooperation Framework Agreement (ECFA) between China and Taiwan, it is anticipated that there will be a not-so-small impact on Korea’s exports to China.
On this day, in its report ‘The ECFA Negotiations between China and Taiwan and Our Countermeasures,” the Korea International Trade Association (KITA) pointed out, “The items for early customs liberalization requested by Taiwan reach around 500, including machinery, petrochemicals, and automobile components. The amount reaches US$12 billion. Once the negotiations are concluded between China and Taiwan, there will be a not-too-small blow to Korean corporations, whose characteristics of the exports to, and investments in, China are similar with those of Taiwan.”
According to KITA, among the top 20 product items exported last year to China by Korea and Taiwan, a total of 14 product items were overlapped, including electronic integrated circuits, liquid crystal devices, oil, semiconductor devices, and office machines. The amount reached around 60% of Korea’s exports to China.
KITA said, “Among the items for early liberalization, the price competitiveness of petrochemical products including organic compounds and plastic products, of which exports Korea is competing for fiercely with Taiwan, can get a blow.”And it emphasized, “In order to maintain competitiveness in the Chinese market, the Korea-China Free Trade Agreement (FTA), which is currently being pursued, must be concluded as soon as possible. The complicated process of approval by Taiwan brings significant delay which makes establishment of Korea-China FTA even more urgent.”