Illustrative image (Photo: Internet) Jakarta (VNA) - ASEAN and the Republic of Korea are currently in the process of upgrading its existing free trade agreement, according to Satvinder Singh, the deputy secretary-general for ASEAN Economic Community.
Singh revealed that two-way trade totalled almost close to 200 billion USD in 2021. These figures made the RoK became ASEAN’s fifth-largest trading partner. In 2021, the RoK's foreign direct investment (FDI) inflows in ASEAN reached 7.1 billion USD. And an upgraded free trade agreement is expected to pave the way for stronger economic ties.
Singh said at the 2023 ASEAN-Korea Trade & Investment Roundtable last week, many other free trade agreements between ASEAN and other dialogue partners, including the RoK, are in the pipeline for upgrade and review.
He emphasised that the two sides are negotiating some of these upgrades, where they will see the innovations that come in supporting region-to-region, as well as the strengthening of the global supply chain. This is an area where many the RoK’s conglomerates are looking to diversify from their current operations in Asia, North Asia.
Singh affirmed ASEAN’s readiness to help Korean firms to not only reorganise their global supply chain for diversification but also to have a low carbon footprint.
In 2005, ASEAN and the RoK inked the Framework Agreement on Comprehensive Economic Cooperation. This led to the signing of four key agreements, including a deal on progressive tariff reduction and elimination, that became the legal instruments for the ASEAN-RoK Free Trade Area (AKFTA). The AKFTA came into effect in 2010.
Besides the AFTA, the 10 ASEAN member states and the RoK are also signatories of the Regional Comprehensive Economic Partnership (RCEP) agreement. This is the world’s largest trade deal, with its signees representing about 30% of the global gross domestic product (GDP)./.
