On Friday, August 31 of 2012, the negotiating teams from Colombia and South Korea agreed on the preliminary version of what will be the text of the FTA between both countries. The document, which first version is only available in English, was signed in Seoul by Javier Gamboa and Lee Yu-Young, heads of the negotiating teams of each country, after concluding the legal review. The next step in the process of ratification of the treaty is the official translation of the document, in order for each State’s representative to sign the final texts. Once the official signatures are given, the Colombian Congress and the South Korean National Assembly will have to proceed with the respective legislative process to approve internally the treaty.
It is important to bear in mind that the negotiation of this FTA was preceded by a feasibility study in 2009, which concluded that Colombia has competitive advantage in some sectors of the South Korean market, which have already been penetrated by other Latin American countries but not by Colombian entrepreneurs. These sectors are sugar refineries and sugar mills, oil and gas extraction, metal melting, production of refined oil, basic iron and steel industry, basic precious and non-ferrous metals industry, glass and products of the glass industry.
Almost all tariffs that cover trade flows between South Korea and Colombia are expected to be completely eliminated after ten years of the entry into force of the FTA. For Colombia, one of the most sensible sectors , which represented a major complexity during the negotiation rounds, was the sector of electronics and vehicles, which imports represent most of South Korean sales to Colombia. Imports of South Korean goods into Colombia reached US 570 million between January and May 2012. Moreover, the major opportunities that have been identified for Colombia are potential exports of (i) coffee, (ii) crude oil, and (iii) copper wastes. Besides, an increase in the investment flows from both countries is expected.
The B&U Customs and International Trade team will provide more information on this important matter, which indeed constitutes a major step forward towards the strengthening of trade relations between Colombia and the countries of Asia.