Mexico FTA Talks Stall
Korea Times
Mexico FTA Talks Stall
By Seo Jee-yeon, Staff Reporter
The launch of free trade agreement (FTA) talks between South Korea and Mexico have stalled, on the latter’s request for an additional concession.
The Ministry of Foreign Affairs and Trade (MOFAT) Thursday confirmed the sixth round of talks between the two countries has recently ended without an agreement for continuing FTA negotiations.
The two sides failed to set a timetable for the seventh talks, which means they will not launch FTA negotiations next month as planned.
Originally, the ministry planned to declare the start of the trade pact talks next month when President Roh Moo-hyun make a state visit to Mexico. It also aimed to wrap up the talks early next year.
As to reasons for barriers ahead of the Korea-Mexico FTA, a MOFTA official said, "Mexico has asked South Korea to pledge investments in the Mexican car industry as a prerequisite for the cooperation accord."
In a bid to make a breakthrough, the ministry discussed the issue with Hyundai Motor. The Korean carmaker remained negative, saying it has to make a full commitment to its newly built U.S. Alabama plant, the official said.
The prerequisite is similar to what the Mexican government asked of Japan when it signed an economic partnership agreement (EPA) with Japan in 2004.
The Japanese agreed to build a car plant that could produce 50,000 units at that time.
The delay of the Korea-Mexico FTA talks is expected to deal a blow to Korean exports to the North American country, because of Japan’s EPA with Mexico, signed in 2004.
``Such products as electronics, mobile phones and cars, which are the nation’s key export items, and are in competition with Japanese goods, will be crowded out from the Mexican market due to higher tariffs,’’ the MOFAT official said.
Korea pushed for the FTA talks with Mexico, in hopes of using Mexico, which has a population of 100 million and is part of the North American Free Trade Agreement (NAFTA), as a springboard to gain access to the huge NAFTA market.
South Korea has an FTA with Chile and signed another with Singapore and the four-nation European Free Trade Association. It is currently in the process of seeking similar deals with Canada and the Association of Southeast Asian Nations.
