Strong exports propelled Korea's economy from recession to recovery last year, but that momentum could slow in 2004 with the launch of free trade agreements (FTAs) between the U.S. and its trading partners.
While lawmakers in Korea continue to postpone ratifying the Korea-Chile FTA, the United States' FTA with Chile and Singapore has gone into effect, raising concerns that Korean exporters will lose competitive ground in the Chilean and U.S. consumer markets, especially in the electronic product and automobile markets.
The U.S.-Chile FTA allows 85 percent of Chilean manufactured products to enter the U.S. market tariff-free, while 87 percent of U.S. exports will be duty-free in Chile. As a result, the South American country's exports to the U.S. are expected to double over the next few years, reaching over U.S. $8 billion. The U.S.-Singapore FTA allows an estimated 79 percent of Singapore goods to enter the U.S. tariff-free, while the Southeast Asian nation will allow all U.S. products to enter without customs duties.
Analysts said that the U.S. would likely enjoy a competitive advantage over Korea in the Chilean market. Seoul is expected to discuss a possible framework for a bilateral free trade pact with Singapore later this month, and is currently seeking to conclude the FTA talks. (Digital Chosunilbo)
to Daily News