The UK has kicked off preparations to negotiate an enhanced Free Trade Agreement with South Korea by launching a call for input asking businesses, organisations and individuals to help shape the UK’s negotiating aims ahead of talks.
The new deal will upgrade our trading agreement with South Korea, ensuring a more modern and fit-for-purpose deal that builds on our existing £14.3 billion trading relationship and meets the specific needs of the UK. This will include important areas such as digital trade, enhanced climate provisions and further support for small and medium sized businesses.
The news comes following Minister for Trade Policy Greg Hands’ visit to CSA Catapult in Newport last week to discuss how an enhanced Free Trade Agreement could increase UK exports to the growing South Korean market. CSA Catapult is a semiconductor research and technology organisation funded by Innovate UK which specialises in promoting UK next generation technology around the world.
Minister for Trade Policy Greg Hands said:
I’m delighted we are on the cusp of launching trade negotiations with another dynamic market in a fast-growing part of the world.
South Korea is a growing market for top-quality British products and services and forms a key part of the UK’s renewed focus on the Indo-Pacific region, securing stronger ties with economies of the future.
The opportunities presented by increasing our trade with South Korea are significant, not least in digitally delivered trade, which accounted for 79% of UK services exports to South Korea in 2020.
The new agreement is expected to include dedicated help for smaller businesses, and provisions for investment and digital trade, which will support economic growth and jobs. Further liberalising our services provisions could also boost UK exports of financial and business services to Korea, already worth £1.4 billion in 2021.
The UK is already a top destination for South Korean green investment and could become an even more attractive country to do business in under a new deal.
Korean companies such as SeAH Wind Ltd are investing in the UK. SeAH have recently announced an investment of over £400 million in a monopile foundation manufacturing facility creating up to 750 jobs by 2030.
South Korea is the 10th largest economy in the world and a top-three global producer of vital goods such as semiconductors and ships. In an increasingly unstable world, boosting trade with a like-minded democracy, and trusted ally, will improve our security and resilience.
The UK and South Korea have already signed an agreement to strengthen supply chain resilience confronting global shortages such as of semiconductors, which impacts products including medical equipment, computers and electric vehicles, as well as other supply chain issues caused by the pandemic.
The agreement will help to ensure the smooth flow of key supplies between our two countries, which will support businesses and public services like the NHS to avoid supply shortages.
Gerard Grech, CEO, Tech Nation, said:
We welcome the news of an enhanced Free Trade Agreement between the UK and South Korea, especially in furthering opportunities for export-ready UK tech scaleups looking to expand there.
Providing companies with the opportunity to directly input into the deal shows real intent by the UK Government to listen to the tech industry, an approach that is testament to Tech Nation’s contribution to the sector and impactful international work.
Martin McHugh, Chief Executive Officer, CSA Catapult said:
The Compound Semiconductor Applications (CSA) Catapult supports the growth of UK industry and has a strong track record in building electronics supply chains for electric vehicles and telecom networks.
Closer trade ties between the UK and South Korea are likely to offer growth for the UK, so we will encourage our industry partners to contribute to this consultation.
Francis Chun, President and CEO, Samsung Electronics UK and Ireland said:
Samsung supports the UK and Korea in continuing to develop their close and positive relationship through comprehensive trade cooperation and the constructive revision of existing trade agreements.
We believe that increased trade between the two countries, particularly in the area of technology and innovation, is important and beneficial for businesses and consumers in both countries.