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SEOUL, South Korea (AP) – South Korea said Friday it will start negotiations to join a U.S.-led trade pact covering a dozen Pacific and Asian nations.
The finance ministry said in a statement that officials will explore the possibility of joining the Trans-Pacific Partnership through the preliminary negotiations.
The move is a first step and doesn't commit South Korea to becoming part of the agreement but the trade ministry has been talking up its benefits for the economy.
Joining the trade bloc of 12 countries that includes Japan, Canada, Mexico and Vietnam faces strong opposition from South Korean farmers and the fishing industry.
Export-reliant South Korea has free trade deals with the U.S. and European Union. It is negotiating a free trade deal with China, which is not part of the U.S.-led pact.
The Trans-Pacific Partnership is not in effect yet but the U.S. and other countries hope for an agreement by the end of this year. Apart from reducing trade barriers, the pact also requires its members to meet environmental, labor and intellectual property protection standards.
South Korea's GDP will get a boost of around 2.5 percent over 10 years, South Korea's trade ministry said at its first public hearings on the TPP earlier this month. Not being part of the free trade area would cause economic losses equivalent to about 0.2 percent of GDP, the ministry said.
Such estimates by the government, however, were challenged by other trade experts who said little is known about the negotiations and the estimates do not take into account free trade deals, such as with China, which could take effect in the future.
Trade experts who urge South Korea to join said the pact will give South Korean firms wider access to the Japanese market and boost exports of auto and refined oil products. They said South Korean exporters may be edged out by Japan in Southeast Asian countries such as Vietnam if South Korea does not become part of the trade pact.
Other experts skeptical about the TPP say it could force greater competition on agriculture, causing loss of livelihoods in South Korea, and might hurt the country's trade negotiations with China.
Benefits of the deal might not be equally distributed and could be outweighed by costs that would be largely shouldered by farmers, they say.
The finance ministry said in a statement that officials will explore the possibility of joining the Trans-Pacific Partnership through the preliminary negotiations.
The move is a first step and doesn't commit South Korea to becoming part of the agreement but the trade ministry has been talking up its benefits for the economy.
Joining the trade bloc of 12 countries that includes Japan, Canada, Mexico and Vietnam faces strong opposition from South Korean farmers and the fishing industry.
Export-reliant South Korea has free trade deals with the U.S. and European Union. It is negotiating a free trade deal with China, which is not part of the U.S.-led pact.
The Trans-Pacific Partnership is not in effect yet but the U.S. and other countries hope for an agreement by the end of this year. Apart from reducing trade barriers, the pact also requires its members to meet environmental, labor and intellectual property protection standards.
South Korea's GDP will get a boost of around 2.5 percent over 10 years, South Korea's trade ministry said at its first public hearings on the TPP earlier this month. Not being part of the free trade area would cause economic losses equivalent to about 0.2 percent of GDP, the ministry said.
Such estimates by the government, however, were challenged by other trade experts who said little is known about the negotiations and the estimates do not take into account free trade deals, such as with China, which could take effect in the future.
Trade experts who urge South Korea to join said the pact will give South Korean firms wider access to the Japanese market and boost exports of auto and refined oil products. They said South Korean exporters may be edged out by Japan in Southeast Asian countries such as Vietnam if South Korea does not become part of the trade pact.
Other experts skeptical about the TPP say it could force greater competition on agriculture, causing loss of livelihoods in South Korea, and might hurt the country's trade negotiations with China.
Benefits of the deal might not be equally distributed and could be outweighed by costs that would be largely shouldered by farmers, they say.
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