Korea, China to hold first trade talks after Xi’s visit

Korea and China will resume talks over free trade agreement after a two-month hiatus. Since the official trade talks will take place for the first time since Chinese President Xi Jinping’s state visit to Korea, chances are high that the two sides will reach broad-based consensus on the degree of market opening.

According to the Trade, Industry and Energy Ministry of Korea on Sunday, the two countries will hold the 14th round of talks on their free trade pact in Daegu from Monday through Friday this week. The South Korean government delegation led by Woo Tae-hee, deputy trade minister at the trade ministry, and comprised of officials from the Strategy and Finance Ministry and the Foreign Ministry will take part in the talks, while the Chinese delegation headed by Wang Shouwen, assistant minister of the commerce ministry, will attend on behalf of Beijing.

A source in Korea’s trade ministry said, “Since both sides agreed to make efforts to conclude the talks over free trade agreement within this year, we will conduct comprehensive, in-depth discussions in all different arenas, including goods and service, based on agreement reached by the leaders of the two countries.”

The issue of utmost interest at this round of talks is to what extent Seoul and Beijing will be able to narrow their differences on the degree of market opening for major products including agro-fisheries and manufactured goods.” At the 11th round of talks in May, the two countries exchanged "requests for concession in goods" containing their respective positions. The requests contain how much tariff rates the two nations will reduce on major products within several years and what conditions each side demands to the other.

Since late last year, the two nations had exchanged demand for concessions on two occasions, but they have failed to hammer out key differences. On agro-fisheries products, the South Korean government has insisted that it cannot make additional openings of the market for products that are cultivated in Korea even in small quantity. China has also expressed objection to Korea’s demand for market opening for automobiles, steels and petrochemicals.

A source in the Korean government said, “As China wishes to conclude Korea-China trade talks at the Asia-Pacific Economic Cooperation Council summit that will convene in Beijing in November, China is expected to display more concessionary stance.” The South Korean government expects to materialize "positive scenario," in which China opens market for key manufactured goods, while Korea minimizes market opening for agro-fisheries products. But even if China reduces the number of items subject to Korea’s market opening to Chinese agro-fisheries products, observers say it will be not easy for the two sides to make achievement due to China`s strategy to lower or remove tariff rates on major Chinese agro-fisheries products.