South Korea and the United Kingdom have concluded negotiations to improve their Free Trade Agreement (FTA). The main points include easing strict rules of origin for key export items such as automobiles and K-food, and further opening the UK’s high-speed rail and major service markets. The Ministry of Trade, Industry and Energy announced that Trade Minister Yeo Han-koo signed a joint declaration with Chris Bryant, the UK’s Minister for Trade, in London.
The UK is the world’s 6th largest economy by nominal GDP and the 2nd largest in Europe, as well as a global financial and investment hub. However, trade volume and exports to the UK are only ranked around 20th globally, necessitating improved market access through these negotiations. The revised Korea-UK FTA is expected to drive trade expansion by easing strict rules of origin for key exports and further opening the UK’s high-speed rail and major service markets.
The two countries did not discuss additional market openings since most goods markets were already opened under the original agreement. Instead, they eased the strict rules of origin for key export items, making it easier for Korean companies to benefit from FTA preferential tariffs. The rules of origin for promising export items such as automobiles, K-beauty, and K-food were also relaxed, paving the way for increased entry of domestic products into the UK market.
Additionally, the government procurement and service markets were further opened. The UK’s high-speed rail market was additionally opened to correct the previous imbalance where only the Korean side was opened. This is expected to support Korean companies striving to enter the European high-speed rail market. The service market was also further opened to include the online gaming sector, where Korean companies have a competitive edge, providing a platform for expanding the entry of domestic games into Europe.