In Search of a Breakthrough for the Korea-EU FTA Negotiations

The purpose of this paper is to seek a breakthrough for the Korea-EU FTA negotiation inagriculture which started last year, but has not made much progress yet. The EU has been askingKorea to open its agricultural market to the same extent that was agreed upon in Korea’s free tradeagreement with the U.S. while the Korean government firmly opposes the EU’s request, saying thatFTA negotiations differ from multilateral trade talks as in the WTO. An examination of agriculturaltrade among Korea, the EU, and the U.S. shows that there may be many niche markets of which theEU can take advantage over other agricultural exporting countries including the U.S. Also, it isexpected that the EU could gain much from its agricultural trade with Korea through an FTA, evenwithout a market access level equal to one stipulated in the Korea-U.S. FTA accord. As far asagriculture is concerned, the slower does the talk proceed, the better to Korea, with the EU losinghuge expected trade gains. It is suggested that the EU needs to be more flexible in the talks byfocusing on a new strategy that can maximize trade diversion effects stemming not only from pricebut from non-price factors, rather than simply asking for the same level of market opening as inKorea-U.S. FTA. This would be the better way for the EU to become a winner in the battle for Koreanagricultural market.