An FTA with (South) Korea

The Herald reports:

After five years of negotations, Korea and New Zealand are set to sign on a free trade agreement this afternoon.

Prime Minister John Key advised the deal was done soon after arriving into Brisbane for the G20 this afternoon. It is a landmark deal for Mr Key as the first bilateral free trade agreement under his watch as Prime Minister.

He will meet with Korea’s President Park Geun-hye before making the announcement. However, he said it would still be a challenge to get it through Korea’s Parliament, which has baulked over free trade agreements in the past.

Mr Key said that was because it involved agriculture which was a politically sensitive issue. However, the agreement was similar to those Korea had signed with Australia, Canada and the United States.

Mr Key said it was “a good deal” and would see tariffs imposed on New Zealand exporters drop by about $65 million in its first year with further drops until tariffs in most areas phased completely over a decade. Mr Key said there were some areas which were of little relevance to New Zealand and other sectors where it would have been impossible to budge Korea further

“I think those sectors might, at the margins, be slightly disappointed but overall people will be pretty happy.”

“Korea is a big market, there is $4 billion in two way trade. We pay about $225 – $250 million in tariffs each year. I think there will be a lot of New Zealand businesses quite happy with it on Saturday night.”

Good to see another FTA agreed. Reducing tariffs benefits both countries involved.