South Korea's Trade Minister Yoo Myung-hee (L) with Britain's International Trade Secretary Liam Fox during a signing ceremony of an in-principle South Korea-UK free trade agreement in Seoul on June 10, 2019. Photo: AFP/Yonhap

South Korea and the United Kingdom agreed in Seoul on Monday to continue the terms of the current EU-South Korea free trade agreement, bilaterally, after the United Kingdom leaves the European Union.

The agreement, reached on Monday between South Korea’s Trade Minister Yoo Myung-hee and visiting British counterpart Liam Fox, marks the biggest preliminary post-Brexit FTA deal yet agreed by London in Asia, or, indeed, globally.

Last year, the trade relationship between the UK and South Korea was worth US$18.5 billion and has increased by an average of 12% per year since the EU-Korea FTA was signed in 2011, according to a communique from the UK’s Seoul embassy.

At a time when London is scrambling to reduce the risks posed by Brexit, G11 South Korea is the most significant economy among 12 nations and trading blocs that the UK has so far agreed to establish free trade agreements with after the country leaves the EU.

With the UK’s ruling Conservative Party in the midst of a leadership contest amid an atmosphere of general political disarray, the format Brexit – the UK’s exit from the EU – will take is as yet unknown. While it may be a negotiated deal, it is possible that the UK may “crash out” of the EU without an agreement, a scenario some business leaders consider calamitous.

While the UK is set to Brexit on October 31, it is also possible that date may be extended. Amid such uncertainty, the agreement signed in Seoul was hailed for offering both British and South Korean businesses predictability.

Eased uncertainties

“The deal is significant as it eased uncertainties sparked by Brexit, amid the already challenging environment for exports on the escalating trade row between Washington and Beijing,” South Korean Trade Minister Yoo Myung-hee said, according to the Yonhap news agency. “We will make our best efforts to help South Korean businesses maintain their operations with Britain without troubles.”

“Providing continuity in our trading relationship will allow businesses in the UK and Korea to keep trading without any additional barriers, which will help us further increase trade in the years ahead,” said the UK’s International Trade Secretary Fox, according to a communique from the British Embassy in Seoul.

“As we face growing global economic headwinds, our strong trading relationship will be crucial in driving economic growth and supporting jobs throughout the UK and Korea.”

The agreement had a thumbs up from exporters of both UK products and services.

Corporate Relations Director, Asia Pacific, Paul Kelleher of alcoholic beverages firm Diageo said he “warmly welcomes” the agreement, according to the communique, while Grant Hughes, the managing partner of law firm Clifford Chance, said: “We are pleased to hear the news of a trade deal which will allow for firms such as ours to maintain our local presence.”

With trade giant South Korea a G11 economy and home to such powerhouse global brands as Samsung and Hyundai, the agreement may be touted by the UK’s pro-Brexit ruling Conservative Party as a triumph heralding a freer UK hand in cutting trade deals.

However, the irony that the future deal will be closely modeled on an EU-South Korea deal signed in 2010 – when Brexit was not even a speck on the political horizon – is unlikely to be overlooked.

Biggest deal so far

Monday’s deal, which agrees to continue the terms of current EU FTAs post-Brexit, is the 12th signed between the UK and its trade partners, a source at the British Embassy in Seoul told Asia Times.

According to the communique, this means the UK will have secured agreements with countries that account for 63% of trade now covered by EU agreements, for which the UK is seeking continuity – an increase from 28% only three months ago.

But beyond South Korea, the trade blocs and countries with whom agreements have been reached are not, in the main, star global economies.

According to the UK government, they are: the CARIFUM bloc – encompassing a clutch of Caribbean islands and Central American states – Chile, the Eastern and Southern Africa trade bloc, the Faroe Islands, Iceland and Norway, Israel, Liechtenstein, Pacific States, the Palestinian Authority and Switzerland.

Strikingly, the EU-Japan FTA, which entered force this February, is not included in the list. A source at the UK embassy noted that Monday’s agreement to transition the EU-South Korea FTA to a South Korea-UK FTA, post-Brexit, does not provide a model for further transitions – such as the EU-Japan FTA.

And how detailed the outlined South Korea-UK deal – described as a “joint statement” in the British communique – is, remains unclear. It also appears to be preliminary: “This marks the end of formal trade discussions and the UK-Korea Free Trade Agreement will be subject to final checks before it formally signed,” the communique read.

The South Korea-EU FTA took three years to negotiate, was signed in 2010 and entered implementation in 2011.

After the UK exits the EU, any final agreement to carry over the 2010 agreement will need to be ratified by both parliaments before taking effect.

Join the Conversation

1091 Comments

  1. Hi there! This is my first comment here so I just wanted to give a quick shout out and say I genuinely enjoy reading through your blog posts. Can you suggest any other blogs/websites/forums that deal with the same topics? Thank you!

  2. Hey there! I could have sworn I’ve been to this site before but after reading through some of the post I realized it’s new to me. Anyways, I’m definitely delighted I found it and I’ll be book-marking and checking back frequently!

  3. This blog is definitely rather handy since I’m at the moment creating an internet floral website – although I am only starting out therefore it’s really fairly small, nothing like this site. Can link to a few of the posts here as they are quite. Thanks much. Zoey Olsen

  4. I was more than happy to seek out this web-site.I wanted to thanks to your time for this wonderful read!! I definitely having fun with every little little bit of it and I have you bookmarked to check out new stuff you weblog post.

  5. wonderful points altogether, you just received a logo new reader. What might you recommend in regards to your publish that you made some days ago? Any certain?

  6. Whats up very cool blog!! Guy .. Excellent .. Wonderful .. I will bookmark your site and take the feeds additionallyKI am glad to seek out so many helpful information here within the post, we want work out extra strategies on this regard, thank you for sharing. . . . . .

  7. I was very happy to find this net-site.I wished to thanks for your time for this wonderful learn!! I positively enjoying each little bit of it and I have you bookmarked to check out new stuff you weblog post.

  8. Thanks for each of your effort on this web page. My mother takes pleasure in managing investigations and it is obvious why. Almost all know all about the compelling form you produce worthwhile guidelines via the blog and as well invigorate participation from other ones on the concern while our child has always been being taught so much. Take advantage of the remaining portion of the year. You’re doing a superb job.

  9. Great post. I was checking continuously this weblog and I’m impressed! Very helpful info particularly the closing part 🙂 I handle such info a lot. I was seeking this particular information for a long time. Thanks and best of luck.

  10. I’ve been exploring for a little for any high-quality articles or blog posts on this kind of area . Exploring in Yahoo I at last stumbled upon this site. Reading this info So i’m happy to convey that I’ve an incredibly good uncanny feeling I discovered exactly what I needed. I most certainly will make sure to do not forget this web site and give it a glance on a constant basis.

  11. This is very attention-grabbing, You’re a very professional blogger. I have joined your feed and sit up for looking for more of your excellent post. Additionally, I have shared your site in my social networks!

  12. I?¦m now not certain the place you are getting your information, however great topic. I needs to spend some time studying more or working out more. Thank you for great information I used to be in search of this info for my mission.

  13. Howdy! This is my first visit to your blog! We are a collection of volunteers and starting a new project in a community in the same niche. Your blog provided us useful information to work on. You have done a wonderful job!

  14. Hey there would you mind stating which blog platform you’re using? I’m looking to start my own blog in the near future but I’m having a tough time selecting between BlogEngine/Wordpress/B2evolution and Drupal. The reason I ask is because your design and style seems different then most blogs and I’m looking for something unique. P.S Apologies for being off-topic but I had to ask!

  15. you are in reality a good webmaster. The site loading pace is amazing. It sort of feels that you’re doing any unique trick. Also, The contents are masterpiece. you’ve performed a magnificent process in this subject!

  16. An interesting discussion is worth comment. I think that you should write more on this topic, it might not be a taboo subject but generally people are not enough to speak on such topics. To the next. Cheers

  17. A powerful share, I simply given this onto a colleague who was doing slightly evaluation on this. And he in fact bought me breakfast as a result of I found it for him.. smile. So let me reword that: Thnx for the treat! However yeah Thnkx for spending the time to discuss this, I really feel strongly about it and love reading more on this topic. If doable, as you grow to be expertise, would you thoughts updating your weblog with more details? It’s highly helpful for me. Huge thumb up for this blog put up!

  18. What¦s Happening i’m new to this, I stumbled upon this I’ve found It absolutely helpful and it has aided me out loads. I’m hoping to give a contribution & help different users like its aided me. Good job.

  19. Hmm is anyone else encountering problems with the pictures on this blog loading? I’m trying to figure out if its a problem on my end or if it’s the blog. Any responses would be greatly appreciated.

Leave a comment

Your email address will not be published. Required fields are marked *