China and South Korea reach a new trade agreement

THE conclusion of free trade negotiations between China and South Korea marks merely the latest in a series of new trade deals in the Asia-Pacific region. Beijing is hoping that its agreement with Seoul will further China’s broader strategic aims involving its Asian neighbor, while South Korea is looking for greater access to the Chinese market to incentivize domestic exports and revitalize a sluggish economy at home. However, the agreement could be harmful to some South Korean industries over the long run, particularly as China shifts its economy toward higher-value industries.

During a Nov. 10 bilateral meeting at the Asia-Pacific Economic Cooperation summit in Beijing, Chinese and South Korean leaders announced that they had reached a broad consensus on a much-anticipated free trade agreement. The deal will be subject to legal and parliamentary reviews by both countries that could begin as early as the end of 2015.