Korea’s FTA Policy & Economic Relations with Latin America

1. July 19, 2005 Korea Institute for International Economic Policy Korea’s FTA Policy & Economic Relations with Latin America whkim@kiep.go.kr Won-Ho Kim, Director, Center for Regional Economic Studies

2. Economic Growth <GDP & GDP Growth Rate>

3. <GDP Per Capita, US$>

4. Trade

5. Characteristics of recent FTAs •Korea has adhered to ‘multilateralism’ because its trade relations were diversified. •Before the1990s, most FTAs aimed for market access through alleviation and elimination of trade barriers •Recent FTAs, which include service, investment, intellectual property rights, and government procurement, aim at being comprehensive •FTAs are promoted not between neighboring countries but between countries in other regions

6. □ Proliferation of FTAs • FTAs proliferated in the 1990s, 208 FTAs by May 2004, (300 FTAs will be in action by 2005) • Recently, East Asian countries are actively promoting FTAs • FTAs expand due to deferred multilateral negotiations and the opportunity cost of non-participation in Regionalism increases Source: WTO CRTA(Committee of Regional Trade Agreement)

7. Status of Korea’s FTAs

8. Consideration for selection of FTA partners 9

9. Korea's Exports Markets

10. Korea's Imports Origins

11. Korea's Trade Partners

12. Korea’s (Economic) Relations / LA • Trade • Dynamic expansion in the 1990s • Fluctuation due to respective economic crises • Recent stalemate of the trade volume, but improving in 2004 -> US$18 billion • Investment (about US$2.5 billion) • Dynamic increase in the mid-1990s • Lost momentum since the financial crisis • Recent diversion to China • ODA: Credit lines; Grants • Korean residents: About 130T (50T in Brazil, 25T in Mexico, 20T in Argentina, 10T in Paraguay…)

13. Financial Cooperation Joining IDB in March 2005 CABEI under study FTA Chile since April 2004 Mexico under joint study MERCOSUR under discussion CACM under consideration Consultation Channels SICA MERCOSUR Rio Group Troika

14. Korea’s Exports Variation

15. (US$ millions)

17. Korea’s FDIs in Latin America

18. Performance of Korea-Chile FTA *FTA: April 2004~February 2005 **Source: KITA

19. Major Exports to Chile

20. Major Imports from Chile

21. International price of copper JUN 2002 DEC 2002 JUN 2003 DEC 2003 JUN 2004 DEC 2004 FEB 2005 *Spot Settlement Price **Source: New York Mercantile Exchange, Inc. (http://www.nymex.com)

22. Thank You