June 2, 2009

S. Korea, ASEAN sign pact on investment

South Korea and the Association of Southeast Asian Nations Tuesday signed a free trade agreement on investment, completing a process that began in 2005.

The agreement signed at the South Korea-ASEAN summit held on South Korea's Jeju Island was the final step in concluding free trade agreements covering merchandise, service and investment, the Yonhap News Agency reported. The agreement on merchandise was completed in 2007 and the pact on service last month.

The investment deal aims to provide protection for investments and investors, the South Korean foreign affairs and trade ministry said in a statement.

The pact includes stipulations that investors be given fair and sufficient protection and safety. They should be guaranteed transparency and allowed the right to use investor-state dispute settlement procedures.

Yonhap said the South Korean government expects the agreement with each member of 10-nation ASEAN to become effective within a year.

The ASEAN members are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, the Philippines and Vietnam.

The agreements are expected to boost South Korea's trade presence in ASEAN.

The South Korean trade ministry said trade with ASEAN totaled $90.2 billion last year. South Korea is now the group's third-largest trading partner after China and the European Union, the report said.