Colombian Exports to South Korea Increased by $45 Million USD in First Year of New Free-Trade Agreement
Colombian exports to South Korea, outside of the mining and energy sectors, have increased by 32.5% since the free-trade agreement came into force between the two countries in July 2016, Colombia’s Ministry of Commerce, Industry, and Tourism announced this week.
The value of Colombia’s exports to the Asian nation amounted to $182 million USD during the measured period compared to $137 million USD the prior year. The reported data covers just under a year, including the latest figures available from the “first year” of the agreement (July 15, 2016, through the end of May 2017).
Agricultural exports contributed the most to the overall total, increasing to $89 million USD in the first year of the agreement from $70 million USD in the preceding period. Industrial products came in second, at $85 million USD in exports, and experienced the biggest rate of increase, jumping by 41.6% from $60 million USD in the year before the free-trade agreement was signed. Coffee, textiles, and paper also showed encouraging growth during 2016, according to the Ministry of Commerce.
“South Korea is the first free-trade agreement for Colombia with the Asia-Pacific region, which is the most economically dynamic on the planet,” said María Claudia Lacouture, Colombia’s minister of commerce. “It is a new stage in the process of diversifying the country’s exports. Korea has more than 50 million people and a per-capita GDP close to $36,000 USD, which is 2.6 times that of Colombia and favors our exports.”
Over the past year, according to the ministry, 121 organizations in Colombia registered as exporters to South Korea for the first time, including 60 in the agricultural industry and 56 from the industrial sector. Businesses also exported 42 different products to South Korea that Colombian companies had never sold there before, including cocoa beans, bananas, flour, wood, paper, mobile phones, microphones, tires, stockings, pens, and ink.
The two nations signed the Colombian/South Korea free-trade agreement in 2013. As is typical, the interim period included a planned phase out of various restrictions and tariffs while generally greasing the wheels for the full implementation in July 2016.
The agreement eliminated tariffs on 4,390 items and reduced tariffs on another 2,797, according to South Korea’s Ministry of Trade, Industry, and Energy (MOTIE). Over a decade, the agreement intends to eliminate tariffs on more than 96% of products exported from Colombia to South Korea and vice versa.
“Colombia is an important member of the Pacific Alliance-leading Latin American economies,” said Kim Hak-do, deputy trade minister of South Korea, in July 2016 when the agreement came into force, per the Korea Times. “The Korea/Colombia free-trade agreement will provide new opportunities for businesses of both countries.”