Monday, December 31, 2007

South Korea and Japan to resume FTA talks

Optimism is in the air that the stalled and deadlocked free trade talks with Japan will see a fresh breakthrough under the economic stewardship of President-elect Lee Myung-bak.

Rosy speculations abound, as the 66-year-old former Hyundai CEO has been stressing improved relations with Japan, while underscoring the importance of "practical diplomacy'' and economic cooperation.Recent remarks by the country's president-in-waiting and Japanese Prime Minister Yasuo Fukuda prioritizing the advancement of pan-Asian ties, will combine to create an even cozier atmosphere for a renewed start of trade talks between the neighboring countries.

Seoul and Japan have so far held six rounds of free trade agreement (FTA) negotiations, but the talks have been at a standstill since November 2004 due to difficulties in bridging the gap over the level of market opening. Korea has called for a high-level opening in the agricultural and fisheries industries, while Japan has demanded only a 50 percent "let-in'' for Korean agricultural imports with a quota on fishery goods.

As the bilateral talks between the world's second and 13th-largest economies continued to go sour, both have been blaming each other for the stalemated.With this Seoul-Tokyo status and further FTA possibilities in mind, Lee, who promised to be an "economy president,'' fronted the free trade agenda as one of his primary campaign pledges.

"The ongoing talks with the European Union will be finalized soon, followed by evaluations and opening of new FTA talks with China, Japan, Russia and other countries,'' Lee said on his campaign trail.

Professor Jeong In-gyo of Inha University, who worked as an advisor for Lee's FTA policies, Tuesday said, "Japan's position regarding an FTA with Korea is showing signs of change,'' according to Yonhap News.

He added that Lee's administration may prioritize finishing off the deal with Tokyo first, before moving onto new accords.

Many factors seem to be driving these efforts, but economic experts and the business circle, which have been strong backers of Lee, were said to have voiced the necessity of the bilateral deal.

The Federation of Korean Industries and the Japan Business Federation jointly agreed last month in Tokyo to push for the conclusion of the Korea-Japan FTA.

And Japan's largest business daily, the Nihon Keizai Shimbun, reported last week that high expectations have been placed on the resumption of the stalled talks, contributing to the optimism.

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