S. Korea, Malaysia seek bilateral FTA, closer ties on energy, defense

Yonhap | 2010/12/10

S. Korea, Malaysia seek bilateral FTA, closer ties on energy, defense

By Lee Chi-dong

PUTRAJAYA, Malaysia, Dec. 10 (Yonhap) — South Korea and Malaysia agreed Friday to push for a bilateral free trade agreement (FTA) and step up cooperation on energy and defense.

The summit deal reached at a meeting between South Korean President Lee Myung-bak and Malaysian Prime Minister Najib Razak in Putrajaya came as the two sides mark the 50th anniversary of the establishment of diplomatic relations this year.

"The two leaders agreed to explore ways and means, including a possible free trade agreement, for the further enhancement of trade and economic ties between the Republic of Korea and Malaysia," a joint statement read.

In 2007, South Korea launched an FTA with the 10-member Association of Southeast Asian Nations (ASEAN), which includes Malaysia, but Seoul hopes for a higher-level separate FTA with the country, one of South Korea’s major economic partners. Two-way trade is projected to exceed US$16 billion this year.

Lee said he and the Malaysian leader have set the goal of doubling the volume in the next five years.

South Korea, whose economy heavily depends on trade, has been aggressive in forging trade pacts with other nations, highlighted by the sealing of an FTA with the European Union in October. Earlier this month, Seoul and Washington completed protracted additional talks on their FTA.

South Korea and Malaysia are expected to promptly begin a joint study on the effectiveness of their FTA, although it remains unclear whether or when they will start full-fledged negotiations.

At a joint press conference with Lee after the summit, the Malaysian leader supported Seoul’s proposal for a bilateral FTA.

"The ASEAN-Republic of Korea FTA already in place has given a strong impetus to relations between the two sides. If there is a separate bilateral FTA, it will enhance bilateral economic cooperation," he said.

The South Korean president held out expectations that South Korea and Malaysia can team up to tap into foreign markets.

"What is important among today’s agreements is that the two nations have decided to work together to make inroads into third nations, taking advantage of their respective strengths," Lee said.

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source: Yonhap