· The ASEAN-Korea Summit on 8 October 2003 tasked Ministers to discuss feasibility of a Framework Agreement on Economic Cooperation between ASEAN and Korea with a view towards establishing a Free Trade Area (FTA).
· At the 8th ASEAN-Korea Summit held on 29 November 2004, the Leaders signed the ASEAN-ROK Joint Declaration on Comprehensive Cooperation Partnership Agreement. Through the Joint Declaration, the Leaders among others agreed to:
o the recommendations of the ASEAN-ROK Experts Group (AKEG) on the measures to expand two-way trade and investment by liberalising and integrating the markets;
o the establishment of an ASEAN-ROK Free Trade Area (AKFTA); and
o launching the AKFTA negotiations in early 2005 with a goal of having at least 80% of products at zero tariff by 2009, and consideration of special and differential treatment and additional flexibility for new ASEAN Member Countries.
· The Framework Agreement on Comprehensive Economic Cooperation between ASEAN and Korea was signed by the Leaders at the ASEAN-Korea Summit on 13 December 2005 in Kuala Lumpur, Malaysia and came into force on 1 July 2006.
· During the ASEAN-Korea Summit on 13 December 2005, the Economic Ministers of Korea and ASEAN signed:
o the Agreement on Dispute Settlement Mechanism between ASEAN and Korea.
On 26 August 2006 in Kuala Lumpur, the Economic Ministers of ASEAN and Korea, with the exception of Thailand, signed:
o the Agreement on Trade in Goods of the Framework Agreement on Comprehensive Economic Cooperation between ASEAN and Korea.
- The main elements of the Framework Agreement include:
o establishment of ASEAN-Korea Free Trade Area (AKFTA):
· FTA for Trade in Goods to be realised by 2012 for ASEAN-6, 2018 for Vietnam and 2020 for Cambodia, Lao PDR and Myanmar; and
· FTA for Trade in Services and Investment to be implemented within the timeframes to be mutually agreed between ASEAN and Korea; and
o cooperation in the areas of:
§ Customs Procedures;
§ Trade and Investment Promotion;
§ Small and Medium Enterprises;
§ Human Resource Management and Development;
§ Science and Technology;
§ Financial Services;
§ Information and Communication Technology;
§ Agriculture, Fisheries, Livestock, Plantation Commodities and Forestry;
§ Intellectual Property;
§ Environmental Industry;
§ Construction Technology;
§ Standards and Conformity Assessment and Sanitary and Phytosanitary Measures;
§ Natural Resources;
§ Shipbuilding and Maritime Transport; and
· ASEAN's trade with the Republic of Korea (ROK) has increased from to RM153.5 billion in 2004 to RM 396.7 billion in 2011. For 2012, ASEAN and ROK recorded total trade of RM417.9 billion. The ROK, with a GDP per capita of RM103,355 represents an important market for ASEAN's exports.
· Malaysia's trade with the ROK also showed a significant growth in the last ten years. Malaysia‘s trade with Korea expanded from RM23.4 billion in 2002 to RM51.6 billion in 2012.
· An FTA between ASEAN and ROK will also strengthen and deepen economic integration and help to build capacity through sharing of available resources and expertise.
· An ASEAN-ROK FTA is also expected to facilitate greater flow of ROK investments into ASEAN.