Background of AKFTA
Considering significant trade ties between ASEAN and Korea and with the view of deepening economic relations between two sides, the Leaders at the ASEAN-Korea Summit in October 2003, in Bali, Indonesia agreed to explore the possibility of establishing a Free Trade Area (FTA) between two sides and formed an ASEAN-Korea Expert Group to study how to pursue the ASEAN-Korea FTA.
During ASEAN-Korea Summit in November 2004 in Vientiane, Lao PDR, Leaders welcomed the recommendation of the Report of the Joint Study on Comprehensive Closer Economic Relations between ASEAN and Korea of the ASEAN-Korea Experts Group (AKEG), among others, to establish a Free Trade Area between ASEAN-Korea Free Trade Area.
The negotiations on the AKFTA commenced in early 2005 and subsequently the Framework Agreement on Comprehensive Economic Cooperation between ASEAN-Korea was signed by ASEAN and Korea on 13 December 2005.
The main objective of this agreement is to establish an ASEAN-Korea Free Trade Area (AKFTA) to strengthen and enhance economic, trade and investment cooperation among ASEAN Member States and Korea by progressively liberalizing and promoting trade in goods and services as well as create a transparent, liberal and facilitative investment regime. The Agreement also aims to explore new areas and develop appropriate measures for closer economic cooperation and integration; facilitate more effective economic integration of the new ASEAN Member States and bridge the development gaps; and, establish a cooperative framework to further strengthen economic relations among the countries.
To achieve the objectives of the Framework Agreement, the ASEAN-Korea Trade in Goods Agreement was signed on 24 August 2006 by ASEAN Member States, except Thailand, and Korea. Thailand acceded to the AKFTA in October 2009.
Following the Trade in Goods Agreement, the ASEAN-Korea Trade in Services Agreement was concluded and signed on 21 November 2007 and The ASEAN-Korea Investment Agreement was signed on 2 June 2009.
The Agreement on Dispute Settlement Mechanism among ASEAN and Korea was also signed on 13 December 2005 to provide a mechanism for any disputes that may arise between Parties from the interpretation, implementation or application of all the stand alone Agreements of the ASEAN Korea Free Trade Agreement (AKFTA).