The ASEAN-Korea Free Trade Agreement (AKFTA) was signed on August 24, 2006, and has had a significant impact on trade relations between the two regions. The agreement aimed to eliminate import duties on a wide range of goods and services and to promote investment between ASEAN and South Korea.
The AKFTA covers trade in goods, services, and investment. South Korea agreed to eliminate tariffs on 92% of its products imported from ASEAN immediately after the agreement was signed. Meanwhile, ASEAN countries agreed to eliminate duties on 80% of their products within a certain period.
The AKFTA also includes provisions for intellectual property rights, e-commerce, competition policy, and government procurement. It provides a transparent and predictable business environment for investors from both regions.
The agreement has been beneficial to both ASEAN and South Korea. In 2019, trade between the two regions reached $160 billion, making South Korea one of ASEAN`s top trading partners. The AKFTA has also provided significant opportunities for businesses to expand and access new markets. Many Korean businesses have established operations in ASEAN countries, while ASEAN companies have gained access to South Korea`s advanced technologies.
However, the AKFTA has also faced some challenges. Some ASEAN countries have felt the agreement was too favorable towards South Korea and that it did not address certain issues such as non-tariff barriers and rules of origin. Efforts have been made to address these concerns through reviews of the agreement and discussions between ASEAN and South Korea.
Overall, the AKFTA has been successful in promoting trade and investment between ASEAN and South Korea. The agreement has enabled businesses to expand and find new opportunities, while also benefiting consumers through increased competition and lower prices. As the two regions continue to deepen their economic ties, the AKFTA will remain an important tool in promoting growth and development.