South Korean president says announcement of free trade deal with EU likely imminent

South Korea: Conclusion of FTA with EU near

SEOUL, South Korea — South Korea and the European Union are ready to announce the conclusion of their free trade talks, President Lee Myung-bak said ahead of a meeting Monday with Sweden, the current chair of the rotating EU presidency.

“I think we can declare the conclusion of negotiations,” Lee told South Koreans in a nationwide radio address broadcast Monday.

Lee is closing out a three-nation European tour in Sweden, which currently holds the rotating presidency of the 27-nation EU.

He said he will confirm the contents of the deal with Sweden’s prime minister. The two were scheduled to meet later Monday.

South Korea and the EU began negotiating the accord to slash tariffs and other barriers to trade in May 2007.

Bilateral trade reached $98.4 billion in 2008. The EU is South Korea’s second-largest trading partner after China and its largest foreign investor.

The talks have dragged out longer than both sides had hoped, however, amid difficulty bridging differences over refunds South Korea pays to local companies for tariffs incurred on imported parts used in exported goods.

Opposition by EU automakers to the deal has also been a sticking point. South Korea enjoys a big surplus in vehicle trade.

South Korea is aggressively pursuing free trade agreements. It reached one with the United States in April 2007, but the deal has since languished in political limbo in both countries and remains unratified.

The European Union’s 27 nations largely backed the deal with South Korea after EU governments met Friday to discuss a draft agreement for the first time, though several nations asked for more time to study the compromise text, an EU diplomat said after the meeting.

The EU’s executive commission negotiates deals for all member countries. EU governments set the boundaries for trade talks and must approve any final deal.

South Korea’s National Assembly would need to ratify the deal for it take effect.