South Korea Seeks Deeper Trade Ties with Latin America
South Korea Seeks Deeper Trade Ties with Latin America
The Asian country inked a free-trade agreement with Colombia nearly a year after its deal with Peru FTA went into effect. Potential exists for accords with Costa Rica and Mexico.
With an eye on Latin America’s growing markets, South Korea aims to boost ties with Latin America through numerous trade agreements. In 2011, Latin America-South Korea trade reached nearly $54 billion. Last week, the Asian country inked a free-trade agreement (FTA) with Colombia after nearly a year of its Peru FTA being in effect. South Korea has expressed interest in joining negotiations for the Trans-Pacific Partnership, a free-trade area with 11 Pacific-Rim countries—including Chile, Mexico, and Peru. The Asian country has had an FTA with Chile since 2004, and could potentially negotiate agreements with Costa Rica and Mexico.
Colombia plans to expand trade with South Korea through a new FTA signed on February 21. The accord—which must receive approval by both countries’ congresses—aims to boost bilateral commerce, which reached $1.9 billion in 2012. Colombian Minister of Agriculture Juan Camilo Restrepo said the agreement opens up “immense possibilities” for the country’s agribusiness, since South Korea is a net food importer. Products such as coffee, flowers, fruit, sugar, meat, and dairy products are included in the accord. The FTA with South Korea also offers opportunities for new Asian trade deals. “The simple initiation and advance of the Korea-Colombia negotiations motivated Japan to show interest in FTA negotiations with our country,” writes Javier Díaz Molina, president of Colombia’s National Foreign Trade Association. “Very likely, an agreement with Japan will be followed by ones with other Asian countries.”
Another Andean country, Peru, is increasingly invested in South Korean ties. This week, Peru’s Vice President Marisol Espinoza visited South Korea for the inauguration of President Park Geun-hye. In Seoul, Park agreed to share knowledge about Korea’s “growth miracle,” while Espinoza said the leaders discussed making Peru the Asian country’s “port of entry” to Latin America. Nearly a year has passed since an FTA between the two countries went into effect, which will eliminate tariffs over the next decade. Consequently, bilateral trade rose to $3.5 billion last year, jumping 76 percent since 2010. Along with trade, tourism is on the rise; Peru has seen an influx of Korean visitors, with the number rising 15 percent a year since 2011. Korean travelers are expected to spend $90 million in Peru this year. In November, President Ollanta Humala visited South Korea, and later that month the countries inaugurated a bilateral cooperation center.
Other Latin America countries could potentially sign FTAs with the Asian country. South Korea hopes to restart talks on a free-trade accord with Mexico since negotiations stalled four years ago. In December, then Prime Minister Kim Hwang-sik visited Mexico to urge President Enrique Peña Nieto to resume those talks. Costa Rica is in discussions with South Korea to forge an FTA; President Laura Chinchilla visited Seoul in August. Costa Rican coffee exports to South Korea reached $8.5 million last year, a 43 percent increase from 2011.
Learn More:
- Learn about the Trans-Pacific Partnership in an AS/COA Online explainer.
- See the text of the Colombia-South Korea FTA.
- Read about the Peruvian VP’s trip to Seoul this week from AméricaEconomia.
