- European Union - South Korea - trade
AFP - South Korea and the European Union have reached provisional agreement on almost all issues in a planned free trade pact, Seoul's foreign and trade ministry said Tuesday.
After almost two years of talks the two sides "reached provisional agreement on almost all pending issues" during negotiations which began Monday, the ministry said in a statement.
They failed to reach a deal on some contentious matters such as rules of origin for products, it said, adding final agreement would be sought at trade ministers' talks in London on April 2.
EU negotiator Ignacio Garcia Bercero told a press conference the provisional deal is the "most ambitious" the EU has ever negotiated with an external partner.
He said the two sides would report to their trade ministers but cautioned that they remain "wide apart" in the two major outstanding issues -- duty drawback and rules of origin.
"Whether we can really conclude our negotiations will be decided between our two trade ministers," said Seoul's chief negotiator Lee Hye-Min.
The two outstanding issues will be "directly negotiated by the two trade ministers," Bercero said.
South Korean officials have previously suggested the deal could be formally announced at the G20 meeting in London on April 2, to send a message that protectionism is not the answer to the global economic slump.
"A successful free trade agreement between South Korea and the EU will send a message that the world should maintain trade liberalism and reject protectionism," Lee said Monday.
He has said the deal could be initialled in late May.
When concluded, the agreement would eliminate some 97 percent of tariffs on bilateral trade over the next five years, Bercero said Tuesday.
The 27-nation bloc was South Korea's second largest trading partner after China last year, with two-way trade worth more than 90 billion dollars.
The EU is the largest foreign investor in South Korea, with outstanding investment reaching 43.40 billion dollars at the end of 2007.
A deal with Europe would be a relief for Seoul after its free trade pact with the United States faltered. That agreement was signed in 2007 but needs ratification by the legislatures of both countries.
The new Obama administration has indicated it wants a partial renegotiation, something Seoul publicly opposes.