BACKGROUND

Encouraged by the success of surging exports following its first free trade agreement (FTA) with Chile in 2004, South Korea unveiled an ambitious plan to push for FTAs with more than fifteen countries by 2007. To achieve its goal, South Korea has launched negotiations with fifty trading partners worldwide. It is believed that the FTAs would ensure more benefits for South Korea's export-driven economy. After all, South Korea is the world's eleventh largest economy. According to Trade Minister Kim Hyun-Chong, a long-term strategy to expand trade through a liberalized economy with less trade barriers is necessary for the South Korean economy, as it is presently facing unfavourable external conditions, such as soaring oil prices, the stronger won against the U.S. dollar, and more non-tariff trade barriers. Therefore, the FTA is the solution for South Korean companies to gain access in foreign markets.

However, South Korea has lagged far behind other members of the World Trade Organization (WTO) in free trade accords. Before South Korea concluded its accord with Chile in March 2004, it was one of only two WTO members not party to any FTA, the other being Mongolia. Presently, the country is in negotiations to eliminate trade barriers with sixteen nations, including the ASEAN states, Canada, the four-member European Free Trade Association (EFTA), and Japan.

Joint research is being conducted with seven nations, including India, Mexico, and Russia, on the feasibility of free trade negotiations. Moreover, South Korea has also established plans for negotiations with twenty-seven nations, such as the United States, China, and the European Union (EU).

South Korea and ASEAN have a long history of economic partnerships. They first established sectoral dialogue relations in November 1989. South Korea was accorded Full Dialogue Partner status by ASEAN at the Twenty-fourth ASEAN Ministerial Meeting (AMM) in July 1991 in Kuala Lumpur.