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South Korea strikes free-trade deal with Indonesia

Christian Fernsby |
South Korea struck a free-trade deal with Indonesia as part of its latest efforts to further expand its trade portfolio in the Southeast Asian market, Seoul's trade ministry said Monday.

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Seoul and Jakarta, which reached a preliminary agreement in October, have concluded their Comprehensive Economic Partnership Agreement (CEPA), according to the Ministry of Trade, Industry and Energy.

The CEPA is equivalent to a free trade agreement but focuses on a broader scope of economic cooperation.

The two countries will officially sign the deal in the first half of 2020 and implement it after securing approval from their respective parliaments, the ministry said.

The FTA conclusion was announced on the sidelines of the special group summit between South Korea and the 10 countries of the Association of Southeast Asian Nations (ASEAN), currently under way in the port city of Busan, 450 kilometers southeast of Seoul.

The two resumed their FTA negotiations this year after a hiatus of five years. The talks began in 2012.

South Korea believes the deal will be yet another milestone in boosting bilateral partnerships under its signature New Southern Policy.

Due to its heavy export reliance on the United States and China, which account for 40 percent of combined exports from Asia's No. 4 economy, South Korea has been a major victim of the protracted Sino-American trade row.

Adding to the concerns, the recent trade tussle between Seoul and Tokyo is another threat for the export-dependent economy.

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