Former Minister for Trade
Australian Commonwealth Coat of Arms

22 April 2008

Study Reveals Gains to Australia from FTA with Korea

The Minister for Trade, Simon Crean, has welcomed the key findings of a non-government study into the feasibility of a free trade agreement between Australia and the Republic of Korea (ROK).

The joint non-government report finds that an Australia-Korea FTA could boost Australia’s GDP by up to US$22.7 billion and Korea’s GDP by up to US$29.6 billion, in the period 2007-2020.

The study clearly shows there is scope for a high-quality Australia-Korea free trade agreement that comprehensively liberalises two-way trade in goods and services as well as investment,” Mr Crean says.

This joint study is a helpful contribution to our discussions with Korea on commencing FTA negotiations.”

We are committed to pushing ahead with FTA efforts at the same time as we press for the strongest possible outcome in the Doha Round of world trade talks.”

Officials from Australia and the ROK will meet in Seoul today (Tuesday 22 April) to discuss the report and discuss next steps towards an agreement.

The study on the FTA was done by Melbourne-based trade consultancy ITS Global and the Korea Institute for International Economic Policy. Mr Crean emphasises that the study is not an official report and that the Australian and Korean governments do not necessarily agree with all of its conclusions.

Mr Crean notes that the Republic of Korea is Australia’s third largest merchandise export market and Australia is a key trading partner of the ROK.

Two-way trade in goods and services between our two countries was worth A$21 billion in 2006-07. This report shows that we can enhance our bilateral trade and investment relationship further through an FTA that comprehensively liberalises bilateral goods and services trade and investment.

I note the study suggests particular gains from cuts to Korean agricultural trade barriers.

Australia and the ROK have secured FTAs with a number of countries. It is important that we begin negotiations with each other, to ensure our bilateral trade and investment continues to grow and is not disadvantaged.

The Doha Round of WTO negotiations remains this Government’s top trade priority. But a comprehensive Australia-Korea FTA can complement and reinforce the multilateral trading system and could bring about real commercial gains for Australian business.

The report is available at: www.dfat.gov.au/geo/rok/fta/

Media Inquiries: Mr Crean's office 02 6277 7420 - Departmental Media Liaison 02 6261 1555