South Korea has put pen to paper on a free trade agreement with five Central American nations to expand its business reach into the region. <br />The FTA is expected to bring positive effects into the Korean economy as well as pave a new trade route to North America.<br />Cha Sang-mi reports. <br /> South Korea is expanding its trade relations with the Central American market.<br />Korea's Trade Ministry officially signed a free trade agreement with five Central American countries on Wednesday to reduce tariffs and eliminate barriers to increased business partnerships.<br /> Trade Minister Kim Hyun-jong said the trade pact with Costa Rica, El Salvador, Honduras, Nicaragua, and Panama will help create a comprehensive, strategic partnership with the Central American nations.<br /> The signing of the deal comes after nearly 3 years of negotiations, which began in 2015. The negotiations touched upon goods, services and investment, non-tariff barriers, trade remedies and a dispute settlement system.<br /><br />The ministry said once the deal is implemented, duties on over 95 percent of goods will be scrapped, either immediately or in phases, boosting exports to Central America.<br /> Korea's state-run Institute for International Economic Policy said Korea's real GDP growth will see an additional point-02 percent growth over the next 10 years, with consumer benefits worth nearly 7-hundred million U.S. dollars.<br />Over 2-thousand-500 new jobs will be created by the FTA, and Korea's automobile and steel industries in particular are likely to benefit from the trade deal. <br /><br /> Minister Kim underscored that South Korea is the first Asian country to strike such a deal with the countries in Central America, paving the way for Korean firms to expand their presence in the region ahead of their Chinese and Japanese rivals.<br />There's also speculation that pact could serve as "a third route" into the North American market, amid the United States' growing trade protection moves.<br /> The FTA will likely go into effect in the first half of this year after the National Assembly approves it.<br />Cha Sang-mi, Arirang News. <br />
