South Korea and 15 other countries are set to launch negotiations on a regional
free trade pact next month, which could bring huge economic impact to Asia's
fourth-largest economy, Seoul's trade ministry said Wednesday.
According to the ministry, the so-called Regional Comprehensive Economic
Partnership (RCEP) involves the 16 countries -- the 10 ASEAN members plus China,
Japan, South Korea, India, Australia and New Zealand, and aims to liberalize
trade in goods, services and investment in the Asian region.
Leaders
from the nations are expected to officially announce the launch of RCEP talks in
late November when they meet in Cambodia, according to the ministry.
The proposed regional free trade pact is similar to a U.S.-led free trade pact
in the Asia-Pacific region.
According to the state-run Korea Institute
for International Economic Policy, the 16 countries have a combined gross
domestic product (GDP) of US$19.7 trillion won, and their trade volume reaches
$10.1 trillion with their combined population amounting to some 3.4
billion.
The regional free trade pact would bring about up to $19.46
billion worth of economic benefits to South Korea, and raise the country's
economic growth by 1.76 percent in 10 years after the deal takes effect. The
projection is based on the assumption that tariffs on all products, excluding
rice, are removed.
"The proposed regional free trade pact would
provide a chance for South Korea to capitalize on a production network in the
East Asian region," said the report.
Meanwhile, Japan, China and South
Korea are also seeking to start negotiations for a trilateral free trade pact
next month.
South Korea and China are currently in talks over their
bilateral free trade agreement. Free trade talks between Seoul and Tokyo have
been stalled since late 2004, mainly because of Japan's reluctance to lower
tariffs on agricultural goods.
But there are growing concerns that
ongoing territorial disputes among the three East Asian countries may delay the
launch of free trade negotiations among them as was scheduled.
According to the ministry, the combined GDP of the three nations reached $12.34
trillion in 2010, accounting for some 19.6 percent of the world's total GDP. The
portion compares with the European Union's 30 percent and the U.S.'s 23
percent.
Trade volume among the three nations amounted to $5.32
trillion in 2010, and their combined population reached 1.52 billion.