Turkey, which is considered by many in Korea to be a brother country for taking part in the Korean War, has taken the step to open its service market to South Korea exclusively. As a result, South Korean companies can enter Turkey's construction, environment, and cultural service markets, an advantage over Japan or China.
Trade Minister Yoon Sang-jick and Turkish Economy Minister Nihat Zeybekci officially signed a free trade agreement (FTA) in the service and investment sectors between the two countries at the Lotte Hotel in Seoul. The service and investment FTA between South Korea and Turkey will take effect this year, after going through the process of National Assembly ratification.
The FTA between South Korea and Turkey consists of basic, product trade, services, and investment agreements, among which the basic and product trade agreements were made first, taking effect May 1, 2013. Services and investment agreements were actually made in the seventh negotiation last July.
This is the first time for Turkey to include service and investment sectors in an FTA. All the FTAs signed between Turkey and the other countries before the Korea-Turkey FTA were limited to the product trade sector.
In the services agreement, both countries agreed to liberalize the trade of services including e-commerce, finance, communications, manpower movement based on General Agreement on Trade in Services (GATS) of the World Trade Organization (WTO). Furthermore, they agreed to open the service market at a higher level than that of the WTO Doha Development Agenda (DDA) concession that they have both made already.
As a result, Turkey is going to open its market higher than the DDA level in 18 sectors including construction (construction, engineering, transportation equipment, etc.), culture (movies, videos, entertainment, etc.), and environment (ventilation gas, purification, noise reduction, etc.).
South Korea permits transfers of financial information and liberal entrance for university-graduate trainees. The investment agreement includes building an institutional framework for activating investments between two countries, including investment liberalization, investment protection, and investor-state dispute (ISD).
Also, there is a clause for national treatments to be applied when the companies of one country enter the services and investment markets of the partner country, so that foreign companies are not treated less favorably than domestic companies.