Seoul, Nov 30 (IANS) South Korea on Monday ratified its free trade agreement (FTA) with China, taking an important step toward regional economic integration.
The ratification bill on the China-South Korea free trade accord was passed through the national assembly by a majority of 196 to 33 votes with 36 abstentions, Xinhua reported.
China and South Korea signed the FTA in June after three years of negotiations.
Under the deal, the two sides will eliminate tariffs on more than 90 percent of traded goods each within 20 years after implementation.
The South Korean government said it will make best efforts to implement the deal by minimising procedures and closely consulting with the Chinese side.
Seoul anticipated that the FTA will help boost its exports, which have been suffering this year from the global economic slowdown.
The China-South Korea FTA is also expected to help accelerate regional economic integration.
“The agreement is a good starting point that leads to negotiations of the trilateral FTA between South Korea, China and Japan as well as of the RECP (Regional Comprehensive Economic Partnership),” said Kim Young-Gui, research fellow at the Korea Institute for International Economic Policy (KIEP).
Kim said the FTA will serve as growth engines for both countries, noting that the agreement will create a chance to boost bilateral trade and economic cooperation.
“The agreement is now about a bilateral trade, but is anticipated to play a pivotal role that will affect Asia and the whole world,” said Han Jae-Jin, a senior research fellow at Hyundai Research Institute.
Han said the FTA has a significant meaning in the region as it will not confine to South Korea and China and can be connected to other Asian nations.
Economic cooperation between China and South Korea has expanded in the past 23 years since the two countries set up diplomatic ties in 1992.
After the 2008 global financial crisis, Seoul and Beijing strengthened cooperation further via the won-yuan currency swap deal to stabilize foreign exchange market.
Now, China becomes South Korea’s largest trading partner while Seoul is Beijing’s third-biggest trading partner as a single country.
The parliamentary voting was conducted during a plenary session after wrangling between rival parties about the sensitive issue on how to protect farmers from possible damage following the FTA implementation.
Before leaving Seoul to participate in the 2015 UN climate change conference in Paris, South Korean President Park Geun-hye urged lawmakers to ratify the deal rapidly, saying that the delayed ratification would make South Korean exporters lose an export opportunity worth $3.5 million every day.
The rival parties finally reached a common ground on Monday, agreeing to $1.4 billion worth of supplementary measures, including a 1-trillion-won fund to support farmers.