South Korea has signed a new trade agreement with the United Kingdom aimed at expanding imports of British-made cars, Scottish salmon and Guinness canned in Britain. The deal replaces a bilateral arrangement agreed in 2019 following the UK’s departure from the European Union.
Bilateral trade between South Korea and the UK is valued at more than £15bn annually. The UK government estimates the updated agreement will generate an additional £400m a year in economic activity, covering sectors including automotive manufacturing, pharmaceuticals, food and drink, and services.
A central provision of the agreement is a change to automotive rules of origin. From January, cars imported into South Korea from the UK will qualify for zero tariffs with only 25% UK or EU content, down from the previous 55%. The change allows UK manufacturers to source components such as electric vehicle batteries from global supply chains while maintaining tariff-free access to the South Korean market.
The agreement opens South Korea’s public procurement market to UK companies and permits the provision of legal services and cross-border business through electronic contracts for the first time.
Under the agreement, South Korea will apply zero tariffs to 98% of goods imported from the United Kingdom.
The deal was announced in London by the trade ministers of both countries and is presented as reinforcing rules-based trade at a time of increased global economic uncertainty.
Asia Pacific Newslog 