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4th Jul 2022

EU downplays delay to Korean trade deal

The EU intends to move ahead with a free-trade agreement currently being negotiated with South Korea, a commission trade official told this website on Tuesday (17 February), despite delays and grumbles from the European car industry.

The next round of talks under the negotiations were originally scheduled to start in the first week of March, but have been set back following complaints that the deal would be detrimental to the European car sector.

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  • Some European car manufacturers fear the negative impact of Korean imports (Photo: European Commission)

"The delay will be a matter of days, nothing more than that," the official said, contradicting Korean media reports that suggested the delay could last for weeks.

"We hope to sign off on the deal in spring."

Talks between the EU and South Korea to secure a free-trade agreement have been running for several months and, if secured, the deal would represent the union's largest bilateral trade agreement to date. South Korea is the EU's fourth largest trading partner.

The European Automobile Manufacturers Association (ACEA) has criticised the current shape of the deal however, saying it offers too many concessions to Korean companies while securing too few benefits for the European car sector.

ACEA director of communications, Sigrid de Vries, told EUobserver that in its current form, the deal would not secure "anything tangible" for the European car sector, adding that it "would set a precedent for other negotiations with countries in the region."

But the trade official dismissed ACEA complaints as the standard negotiating procedure that they deploy to secure a more favourable negotiation position from the commission, saying that as a whole, the European car sector supported the free-trade agreement.

He added that backing away from current negotiations with South Korea would throw the EU's trade policy as a whole into disarray.

"European industries such as machinery, chemicals, processed foods, textiles and service providers are all very keen that we forge ahead and conclude these negotiations in the coming months," commission trade spokesman Peter Power said last week.

He continued that the European car sector has much to gain from the current agreement, especially through the elimination of many ‘behind the border barriers' such as burdensome regulation that currently limit the sale of European goods.

However Ms de Vires said that while some progress had been made on the issue of non-tariff barriers in other sectors, little had been made concerning car sales.

The EU exported €25 billion worth of goods and €6 billion worth of service to South Korea in 2007.

The Asian country's economy is primarily export driven and the government is keen to secure free-trade agreements with a number of countries around the world such as the US, where a deal is currently awaiting ratification by the Congress.

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