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The fifth Trade Policy Review of Korea has given us a much clearer
understanding of Korea's trade policies and practices and of the
challenges that it faces. I thank Mr.Ahn Ho-young, Deputy Trade
Minister of the Ministry of Foreign Affairs and Trade, and his
delegation as well as the Discussant, Ambassador Bozkurt Aran of
Turkey, and Members of the TPRB for contributing to our informative
and constructive exchange of views during these two days. Korea's
response to the large number of questions is also very much
appreciated.
Members commended Korea for its prudent macroeconomic policies and
structural reforms, including its continuing pursuit of open trade and
investment policies, which have contributed to it becoming a more
outward-oriented economy enjoying stable growth, declining
unemployment, increasing per capita incomes and contained inflation.
In the midst of the present financial upheaval, several Members
recalled Korea's recovery from the Asian Financial Crisis through
increased liberalization (rather than protectionism), an important
lesson in today's global economic environment.
Several members noted that inward FDI had declined as a proportion of
GDP and is low by industrialized country standards. They encouraged
Korea to further liberalise its foreign investment regime and continue
structural reforms, especially involving deregulation and
privatization. Members welcomed measures taken to create a business
friendly environment, including the creation of the Presidential
Council on National Competitiveness.
Members praised Korea's active and constructive participation in the
Doha Round. At the same time, some Members urged Korea to ensure that
its regional trade agreements were complementary to the multilateral
trading system. Members also acknowledged Korea's support for the
WTO's technical assistance activities.
Korea was commended for its streamlined customs procedures. Members
noted that the tariff remains relatively high, given Korea's level of
development, and somewhat complex, involving a multiplicity of rates.
Members were concerned that Korea's flexible tariff mechanism allowed
discretionary changes in certain rates. Members also remarked that the
average applied MFN tariff for agricultural products is more that
eight times higher than the tariff for non-agricultural products. They
encouraged Korea to step up agricultural reforms and thus reduce
distortions in both production and trade of agricultural goods.
Members also expressed concern about several aspects of Korea's
agricultural tariff rate quota system, which are under-utilised even
for commodities for which domestic Korean prices are significantly
higher than world levels. Members urged Korea to make improvements in
these and other areas so as to make its trade regime more transparent
and predictable.
Some members were concerned about Korea's recourse to anti-dumping
actions and to changes in its calculation of dumping margins. Certain
Members sought clarifications on some aspects of technical standards
and SPS practices. Some Members noted Korea's further strengthening of
intellectual property rights and expressed interest in other related
developments.
Some Members noted the high degree of government intervention in
agriculture and expressed concern regarding subsidies to the fisheries
sector. Other Members wondered about the ways for enhancing
competitiveness of the services sector, whose labour productivity was
half that of manufacturing. In addition, certain Members raised
questions over the lack of foreign participation in telecoms and
broadcasting as well as plans for market opening with regard to
professional services.
To conclude, I would again like to thank Korea's delegation for
enabling us to understand better its trade and trade-related policies
and the domestic and international contexts in which they are
formulated and implemented. I would also like to thank the Discussant
for his insightful comments, and Members for contributing to what has
been a very enlightening two days of discussions. We look forward to
receiving responses to the remaining outstanding questions within the
next month. |
