Korea – Central America FTA launched
A free trade agreement between the Republic of Korea and five Central American countries, namely Costa Rica, El Salvador, Honduras, Nicaragua and Panama was signed on 21 February 2018. The negotiations started in June 2015, and it took two years and eight months to come to an agreement. The signing ceremony took place in Seoul, at the Lotte Hotel, where Kim Hyun-chong, Minister for Trade of South Korea, met his colleagues from the five states. The Republic of Korea is going to settle legal formalities and launch the free trade zone in the first half of 2018.
The subject of the FTA is commodities, investments and intellectual property. The parties came to conclusion to remove 95% of custom tariffs in mutual trade. Some of the barriers will be removed immediately; the others will be eliminated in phases. The tariffs for coffee and mango were the issue of top priority for the Central American countries. Korea was interested in cost reduction for automobiles and steel supply. As a result of the FTA, Korean economy is expected to grow by 0.02%, what improves civilian welfare by $690 million.
The value of the event can hardly be overestimated, since South Korea was the first East Asian country to sign such kind of agreement with the five states. Cross-Pacific economic ties are developing. Integration processes are on the march.
Press-release at the Korea.net official web-site