South Korea has concluded a free trade agreement with the Philippines in a move expected to bolster ties with the Southeast Asian nation and help diversify South Korea's trade portfolio, Seoul's trade ministry said Tuesday.

Trade Minister Yeo Han-koo and his Filipino counterpart, Ramon Lopez, were to declare the conclusion of the bilateral Free Trade Agreement (FTA) and sign their joint statement during a virtual meeting set to be held in the day, according to the Ministry of Trade, Industry and Energy.

The two sides began negotiations in June 2019, and had held five rounds of official talks before reaching the agreement.

It is South Korea's fifth bilateral free trade deal with Association of Southeast Asian Nations (ASEAN) member countries, after Singapore, Vietnam, Malaysia, and Cambodia.

"The agreement is expected to help boost our access to the young, dynamic market," the ministry said in a release. "It will also serve as a foundation for broader bilateral cooperation in such various fields as healthcare, electric vehicles and climate change."

Under the deal, the Philippines will lift tariffs on 96.5 percent of all products traded, and South Korea will remove tariffs on 94.8 percent of all items, according to the ministry.

Manila, in particular, agreed to lift barriers for South Korean cars and auto parts, which is expected to help South Korea secure competitiveness in the market, the ministry said.

South Korea has inked an FTA with the ASEAN, but has sought to also clinch separate free trade deals with ASEAN nations, particularly after launching the so-called New Southern Policy in 2017 aimed at deepening diplomatic and economic cooperation with the regional bloc.

ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Thailand, Singapore and Vietnam. (Yonhap)