Korea seeks to benefit from FTAs to beat global woes

With economic doldrums gripping many parts of the world, Korea plans to cultivate fresh strategic export items and stimulate small and medium businesses to cash in on free trade pacts next year and keep Asia’s fourth-largest economy afloat.

The Ministry of Knowledge Economy on Thursday announced measures to boost transactions with its 45 trade partners and shore up exports, the bellwether for the national economy, at an emergency meeting of top economic officials presided over by President Lee Myung-bak.

“It seems that small- and mid-sized enterprises are still not keen to benefit from FTAs,” Lee told the meeting.

“The government should better inform them so that they can actively take advantage of the pacts.”

Under the plan, the government will set up 17 “FTA support centers” nationwide next year to help local small manufacturers understand the pacts and their potential benefits.

The government also plans to create a comprehensive online database where company officials access information such as on tariff regimes, technical standards and environmental regulations in their target countries.

Korea has free trade pacts with 44 partners including Chile, Singapore, India, Peru and the European Union. It has ratified an agreement with the United States but has yet to effectuate it.

Moreover, the government will pick 25 local food items to expedite exports, including paprika, seaweed and makgeolli, a Korean rice wine. This will also help prop up farmers deemed to be among the victims of the FTA, ministry officials said.

To carve out new niches in the global marketplace, the ministry said it plans to form a fund worth 100 billion won ($86.4 million) to back exports of Korean dramas, shows and other cultural content.

During the meeting, Lee underscored the significance of fostering new markets as well as retaining Korea’s clout in existing ones in the wake of the global economic gloom.

“The government and private sectors should work harder together at a time like this,” he said. “We have to beef up state support through export financing and insurance next year.”

By  Shin Hyon-hee (heeshin@heraldcorp.com)