Kaesong products covered under ASEAN agreement

From the Joong Ang:

Asean agrees to accept Kaesong goods in FTA

Members of the Association of South East Asian Nations agreed to accept South Korea’s request to recognize some products from a North Korean industrial park as South Korean as part of plans for a free trade pact, officials here said yesterday.

Under the agreement, reached yesterday at a meeting of finance officials in Kuala Lumpur, nine out of the 10 Asean member nations will give preferential tariffs on 100 items made in the inter-Korean business complex in the North Korean border city of Kaesong, the Ministry of Foreign Affairs and Trade said in a statement. In May, South Korea and Asean agreed on the liberalization of trade between the two sides by 2010.

“We feel this is an important step in integrating North Korea into the international community and I would like to express my gratitude to Asean,” AFP quoted South Korean Trade Minister Kim Hyun-chong as saying at a press conference in Kuala Lumpur yesterday.

The agreement allows Asean countries to choose 100 Kaesong-made goods each for preferential tariff treatment, the Korean ministry said. Thailand, the Asean member country that stayed out of the agreement in May due to differences over the rice market opening, didn’t sign the agreement, the ministry said.

Still, to finalize the proposed free trade accord, South Korea and Asean have to have open talks on other deals regarding trade and investment.

South Korea is also engaging in talks for a proposed free trade accord with the United States, and the issue of Kaesong has been a key stumbling block.

Seoul demands Washington recognize the Kaesong-made goods as originating from South Korea, as part of its efforts to boost inter-Korean trade and bring a market economy to the communist neighbor.

Washington’s trade officials have been cool about the idea, saying the agreement should only cover goods from South Korea and the United States. 


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