EU agrees to South Korea free trade deal

[pampango]

Source: Associated Press

The European Union agreed Thursday to a free trade pact with South Korea that will slash billions of dollars in industrial and agricultural duties, despite some countries' worries that the auto industry could be hurt by a flood of cheaper cars.

The deal — the first such pact between the EU and an Asian trading partner — will be signed at an EU-South Korea summit on Oct. 6 and come into force on July 1, 2011, said Belgian Foreign Minister Steven van Ackere, whose country holds the union's rotating presidency. Van Ackere called the deal "a very big step in opening markets in Asia" to European businesses. "This will create prosperity and jobs across in Korea but also in Europe."

The EU is South Korea's second-largest export destination, and South Korea is the bloc's eighth largest trade partner, according to figures from the European Commission. EU trade with South Korea exceeded euro 65 billion ($84 billion) in 2008.

The European Commission estimates the deal will see the elimination of euro1.6 billion ($2.1 billion) worth of industrial and agricultural duties for European exporters to South Korea. The EU will cut some euro 1.1 billion ($1.4 billion) of duties for Korean importers.

Read more: http://www.google.com/hostednews/ap/article/ALeqM5iOEsXe7IB_J5XLmBSv6Z7T2qtX-AD9I8UMK03

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"The EU is South Korea's second-largest export destination". - I thought the US must be South Korea's largest export market but they export twice as much to China as they do to the US.

http://www.state.gov/r/pa/ei/bgn/2800.htm

"Major export markets (2008)--China (21.5%), U.S. (10.9%)"

""This will create prosperity and jobs across in Korea but also in Europe."" - The European mentality is sometimes so different from ours. I can't imagine an American official discussing a trade agreement and lauding the benefits to the other country first with a statement along the lines of ""This will create prosperity and jobs in (fill in the name of any country) but also in the US. Might not remain an American official for very long."

[dipsydoodle]

1. I'd think

the most significant outcome could be car pricing here in Europe assuming there was some current form of significant duty on cars at present.