HISTORY AND SIGNIFICANCE OF THE FREE TRADE AGREEMENT

After eight rounds of negotiations, lasting almost two-and-a-half years, the Free Trade Agreement between the European Union and its Member States of the one part, and the Republic of Korea of the other part was initialled on 5 October 2009, and it was officially signed on 6 October 2010. The Agreement was provisionally applied from 1 July 2011, pending its formal entry into force, which will occur when it is fully ratified by the EU, all twenty-seven Member States and Korea.

In many senses, the Free Trade Agreement (FTA) is a logical progression from the Framework Agreement on Trade and Cooperation, concluded by the EU and Korea in 1996. The reference to increased bilateral cooperation in the 1996 Framework Agreement had already hinted at the possibility of negotiating closer economic ties between the two partners, and the speed with which the FTA was negotiated is testament to the close relations which the two partners had already developed.

Even before the full effects of the FTA have been felt, the EU and Korea are already significant trading partners. In 2011, the EU exported goods worth €32.4 billion and services worth €7.5 billion to Korea. Indeed, the EU is the second largest source of imports to Korea, only after China. For its part, Korea exported goods worth €36.1 billion and services worth €4.5 billion to the EU, making Korea the tenth largest trading partner of the EU.