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EU, South Korea in trade deal â€Ž

17 September 2010 09:18 (UTC +04:00)

Baku - APA-Economics. The European Union (EU) yesterday agreed to sign a sweeping free trade agreement with South Korea â€” its first with an Asian partner â€” after Italy withdrew its objection, Business Day reported.

Politicians and officials welcomed the announcement, saying it proved protectionist pressures were being resisted, despite global economic uncertainties.

â€œThis the first generation of bilateral trade agreements which will bind Europe and Asia together in an ever-closer economic bond,â€ said Steven Vanackere, vice-prime minister and foreign minister of Belgium, which holds the EUâ€™s rotating presidency. â€œThis is a very big step in opening markets in Asia for European companies.â€

The deal, which took years to negotiate, will be signed at an EU- South Korea summit in Brussels next month and will enter into force from July, he said.

The deal will remove most tariffs between the two economies, as well as many non-tariff barriers. The European Commission estimates it will be worth Â¤19bn in new trade for exporters, and will boost jobs and growth.

Italy had resisted giving its final approval to the pact, which requires unanimous backing from all 27 EU member states, because of concern about the effect on its vehicle industry. But with little support it capitulated after agreeing to a small concession of a six- month delay in implementation.

EU-South Korean trade was worth Â¤53bn last year.