Korea-China FTA in Its First Year and Effectuation

5 Pages Posted: 8 Feb 2017

See all articles by Kyu Yub Lee

Kyu Yub Lee

Korea Institute for International Economic Policy

Joun Won Lee

Korea Institute for International Economic Policy

Min-Chirl Chung

Korea Institute for International Economic Policy

Date Written: February 8, 2017

Abstract

On 20 December 2015, the Korea-China Free Trade Agreement (FTA) entered into force. The Korea-China FTA would impact both economies' welfare in the long run, elevating it to a higher level compared to before the FTA was concluded. However, it must be pointed out that in the short run, trade activities between Korea and China might be affected by external/internal economic forces such as the persistent global trade slowdown and weak domestic economic growth, and non-economic forces such as THAAD and non-tariff barriers. Thus, it might be impetuous to examine the economic impact on the Korean and Chinese economies just a year after the Korea-China FTA was concluded. Nevertheless, it would be worth examining the positive changes that have occurred over the last year, and providing constructive suggestions to both countries in order to accelerate the materialization of the benefits of the Korea-China FTA.

This article investigates the major changes after the Korea-China FTA in terms of trade of goods and services, digital trade, and investment. Section II covers a brief analysis of the trade of goods between Korea and China. Section III underscores the distinctive features of international digital trade between Korea and China. Section IV provides facts on trade in services and investment. The last section presents policy implications for the Korea-China FTA.

Keywords: Korea-China FTA

Suggested Citation

Lee, Kyu Yub and Lee, Joun Won and Chung, Min-Chirl, Korea-China FTA in Its First Year and Effectuation (February 8, 2017). KIEP Research Paper World Economy Brief 17-04, Available at SSRN: https://ssrn.com/abstract=2913374 or http://dx.doi.org/10.2139/ssrn.2913374

Kyu Yub Lee (Contact Author)

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

Joun Won Lee

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

Min-Chirl Chung

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

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