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  • SKorea boosts SEAsia ties amid downturn

    SKorea boosts SEAsia ties amid downturn


    SEOGWIPO - South Korea is seeking both stronger economic ties with Southeast Asia and diplomatic backing against North Korea as it hosts a lavish summit of regional leaders here, analysts said.

    With the global downturn hitting Western demand for its exports, Seoul is looking increasingly to a relatively more resilient Southeast Asia.

    It also wants the region's diplomatic backing against its Stalinist northern neighbour, which last week tested an atomic bomb for the second time, the analysts said.

    Ten leaders of the Association of Southeast Asian Nations (ASEAN) and South Korean President Lee Myung-bak will start a two-day summit later Monday in the scenic island of Jeju to mark 20 years of dialogue.

    South Korean sources said the government spent the equivalent of 2.4 million dollars to host the event.

    The resort island is plastered with billboards and other displays promoting the summit. Its core message is "warm-hearted neighbours and partners for prosperity," organisers say.

    "South Korea's Asian diplomacy has focused too much on Northeast Asia, largely Japan and China. It has actually paid too little attention to Southeast Asia despite its huge potential," said Cho Hung-Guk, a Southeast Asia expert at Pusan National University.

    "It is welcome news, though, that South Korea is belatedly trying to balance its diplomacy," he told AFP.

    Cho said Seoul's relationship with ASEAN, a market of about 600 million people, has lagged "far behind" that of Japan and China, which have grown in depth and volume.

    Panitan Wattayanagorn, spokesman for Thai Prime Minister Abhisit Vejjajiva, said there was a need for the two sides to deepen relations further as they deal with the impact of the global downturn.

    "Time is critical as ASEAN needs a close partner, and vice versa, to be able to deal effectively with the impact of the economic crisis," Panitan, whose country is the ASEAN current chair, told AFP.

    Thailand is looking forward to further cooperation with Seoul in the areas of energy and environmentally-friendly technology, he said.

    Thailand's second stimulus package will offer opportunities for South Korean industries in telecommunications, transportation and other crucial infrastructure.

    Premier Abhisit brought along with him a large Thai business delegation.

    "The market size is very significant for both sides," Panitan said.

    Resource-poor South Korea is eyeing abundant raw materials from ASEAN, which includes resource-rich countries like Indonesia, Malaysia and Brunei -- all producers of crude oil and natural gas.

    "Korean companies are developing natural resources such as crude oil, natural gas, timber, rubber etc. in Indonesia and Malaysia," its finance ministry said in a statement.

    ASEAN is already South Korea's third largest trading partner, with two-way trade worth around 90 billion dollars last year, and its second largest destination for overseas investment.

    Korean investment in the region was worth 5.86 billion dollars last year.

    The figures are expected to rise further when the two sides on Tuesday sign an investment pact, completing negotiations on a free trade agreement that began in 2005.

    Former ASEAN secretary general Rodolfo Severino said ASEAN-South Korea ties have always been problem-free and there is enormous people-to-people contact.

    More than 3.3 million Koreans visited ASEAN nations as tourists last year, while about 800,000 visitors came the other way.

    South Korean cars, electronics goods and soap operas are popular in the region.

    Strategically, South Korea "needs the support of Southeast Asia in its relations with the North," Severino said.

    Cho, the South Korean analyst, said however that relations will have to be nurtured.

    "I don't expect this one-off summit event to bring any meaningful change to the South Korea-ASEAN relationship overnight," he said.

    "This should serve just as a starting point and you have to make continuous efforts on a long-term strategy."
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  • #2
    Update:

    SKorea, ASEAN complete sweeping free trade pact


    SEOGWIPO - South Korea and Southeast Asia on Tuesday completed a sweeping free trade agreement which they hope will nearly double two-way trade to $150 billion by 2015.

    Trade ministers from South Korea and the Association of Southeast Asian Nations (ASEAN) signed the pact to liberalise investments on the final day of a summit by their leaders on the southern island of Jeju.

    The investment accord is the final plank of a comprehensive free trade agreement that also covers trade in goods and services. Pacts opening up trade in goods and services are already in force.

    "We expressed our expectations that the trade volume between ASEAN and the ROK will increase to $150 billion by 2015 through the ASEAN-ROK FTA and other complementary trade arrangements," the leaders said in a joint statement.

    ROK refers to Republic of Korea, South Korea's formal name.

    Two-way trade doubled to $90.2 billion in 2008 from $46.4 billion in 2004.

    The completion of the free trade pact comes amid a push by South Korea to further increase its presence and influence in ASEAN, a 10-nation bloc with a combined population of more than half a billion people.

    Analysts said China and Japan are already ahead in engaging ASEAN, which has a combined gross domestic product of around $1.3 trillion.

    South Korea's finance ministry said the country sees ASEAN "as an export market which can offset sluggish markets in developed countries," especially after the global financial crisis.

    Apart from exports, its companies are also expected to benefit since infrastructure spending is a major part of government stimulus packages in Southeast Asia, ASEAN officials have said.

    South Korea can also secure better access to ASEAN's massive wealth in natural resources including timber, rubber and oil and gas.

    Indonesian Trade Minister Mari Pangestu told AFP in an interview on Monday that her country exports $4 billion to $5 billion worth of natural gas to South Korea annually.

    South Korea also buys food and fish products as well as footwear, textile and paper and pulp from Indonesia.
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