JOINT MINISTERIAL STATEMENT ON THE LAUNCH OF

KOREA-CHINA FREE TRADE AGREEMENT NEGOTIATION

(May 2, 2012, Beijing)

1.  BARK Tae Ho, Minister for Trade of the Ministry of Foreign Affairs and Trade of the Republic of Korea and Chen Deming, Minister of the Ministry of Commerce of the People’s Republic of China held a meeting in Beijing on 2 May, 2012 and shared the view that the Korea-China FTA is of significant importance for both countries in further strengthening and broadening the long-existing bilateral economic cooperation and trade relations, and thus deepening Korea-China Strategic Cooperative Partnership. Building on the objectives, principles and recommendations recognized in the Joint Feasibility Study of a possible Korea- China FTA, and further exchange of views undertaken thereafter on how to address the sensitivities in the context of future FTA negotiation, the Ministers hereby announced the launch of the Korea-China FTA negotiation.

2.  The Ministers agreed that the first round of the negotiation will be held soon after the launch of the negotiation, and the two countries will endeavor to conclude the negotiation at an early date.

3.  The Ministers agreed that soon after the launch of the negotiation the two countries will start negotiation to finalize modalities for Trade in Goods, Services, Investment and Other Areas, which will be an integral part of the Agreement.  The Ministers also agreed that, after the finalization of the modalities, the two countries will enter into the rest of the negotiation covering all sectors including goods, services, investment and other issues on the basis of these modalities and conclude the negotiation as a single undertaking.

4. The Ministers agreed that the level of liberalization for Trade in Goods should go beyond each country’s commitment in the WTO. To address the sensitivities in the area of Trade in Goods, a normal track and a sensitive track will be established. The Ministers further envisaged longer phase-out periods, partial reductions, exclusion, etc. for the possible treatments for sensitive track, which may include a sensitive list and a highly sensitive list.

5.  The Ministers agreed that the level of liberalization for Trade in Services should go beyond each country’s commitment in the WTO. As for Investment, the Ministers highlighted that the level of ambition and coverage will be defined to appropriately address the issues related to bilateral investment flows, while taking into account the current and future investment-related arrangements involving the two countries.

6. The Ministers confirmed that appropriate provisions to address issues relating to the Outward Processing Zone (OPZ) designated by both countries will be included in the future Korea-China FTA.

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