Trade With ASEAN Up 34 Percent

The Korea Times
http://www.koreatimes.co.kr

05-31-2009

By Yoon Ja-young
Staff Reporter

Trade between Korea and ASEAN member countries grew significantly since the signing of a bilateral trade pact on goods exports, statistics showed.

According to the Ministry of Strategy and Finance, Korea's trade with the Association of Southeast Asian Nations (ASEAN), comprising Singapore, Malaysia, Indonesia, the Philippines, Brunei, Laos, Myanmar, Thailand, Vietnam and Cambodia, increased to $73 billion for the one year since the agreement took effect, from $58.4 billion trade seen during the year before. The two sides are scheduled tomorrow to sign trade the investment portion of their free trade agreement (FTA), the last in a three-phase setup.

Trade with all ASEAN member countries grew so much that ASEAN is now the third largest trade partner for Korea, behind China and the European Union.

The total trade for the two years after the agreement recorded $138 billion, up 33.8 percent from $103.2 billion seen for the two years before the agreement, despite the global financial crisis.

The brisk trade took place in auto and steel trade. Korea's export of autos and parts to ASEAN, the world's 11th largest economy, jumped 77.3 percent in the first year after the pact took effect in the middle of 2007. Steel exports increased by 23.3 percent, and petrochemicals by 20.8 percent.

Korea is increasingly importing agricultural and fisheries products from the region. Its investments in ASEAN, with a population of 580 million and the GDP of $1.3 trillion, recorded $5.9 billion in 2008, making the region the second largest destination for the country following the United States.

The Ministry of Strategy and Finance said that the FTA is positively affecting trade between the two parties, and expects it to grow further. It cited Thailand's signing of an agreement on goods trade in February as a positive factor. The Korea-ASEAN FTA comprises of three parts ― agreement on trade of goods, services and investment.

``ASEAN is the major export market which can offset the sluggish mood in the developed market following the global economic crisis. The ministry will strengthen policy efforts to expand market share there,'' it said. Korea's share in the region stood at 5.1 percent as of 2007, growing from the 4.7 percent seen two years ago, but it is still small compared with China's 12.3 or Japan's 11.4 percent.

The ministry said it would strengthen the basis for economic cooperation with ASEAN through official development assistance.