• Korea Trade Review
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• v.41 no.2
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• pp.123-157
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• 2016

As the WTO·DDA continues to stagnate, mega FTAs such as the TPP will likely play the leading role in rule-making of trade for some time to come, creating a 'spaghetti bowl' of trade rules. FTAs, notably high-standard and broad-based regional or mega-FTAs, are the appropriate means to achieve this objective, because they cover many of the policy measures that are needed for the development of global value chains(GVC). The highest quality FTAs are increasingly adding new features like regulatory harmonization that may also foster GVC growth in partner countries. Complementary relationships among markets along value chains, involving both goods and services, also complicate analysis. This is particularly relevant when thinking about policy, since the traditional tendency to think about policies and regulate markets in unconnected silos can lead to unintended and undesirable results. This paper examines the current states of FTAs to determine which are more likely to push this latest wave of globalization further and faster, and explores the plans that are most helpful for GVC growth.

• East Asian Economic Review
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• v.17 no.4
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• pp.333-359
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• 2013

Two mega-regional negotiations are changing the landscape of Asia Pacific trade policy: an Asian track centered on ASEAN (the Regional Comprehensive Economic Partnership or RCEP), and a Trans-Pacific track centered on the Trans-Pacific Partnership (TPP) among 12 economies, including the United States, which Korea is expected to join. Modeling results suggest that both would generate substantial benefits for Korea and the global economy. From Korea's viewpoint, the agreements would establish new FTAs with China, Japan and smaller economies, improve the utilization of FTAs by permitting the regional cumulation of inputs, and help to upgrade some Korean FTAs to more rigorous standards. By participating in these agreements, Korea could also help to guide them toward inclusive, high-quality regional outcomes. As one of the region's most open and agile economies, Korea has a large stake in regional integration and would be well advised to pursue both tracks.

• Journal of Korea Trade
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• v.23 no.3
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• pp.118-137
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• 2019

Purpose - As global trade disputes intensify and global trade uncertainty increases due to the prevailing trade protectionism all over the world, mega-FTAs such as the RCEP and CPTPP are suggested as strategic trade policy options for export-driven small open economies, such as Korea. This paper aims to provide a comprehensive analysis of Korea's mega-FTA participation and the induced implications for the Korean economy. Design/methodology - We use a multi-region, multi-sector global CGE model, and investigate the different effects of both the US-China and US-EU trade wars on the relative changes in GDP, welfare, and trade under different trade policy regimes; (i) Korea does not participate in any mega-FTA, (ii) Korea participates in the RCEP, and (iii) Korea participates in the CPTPP. Findings - We show, among others, that though industrial effects might be largely varied, the overall enlarging of free trade zones through multilateral mega-FTA participation may contribute significantly to the macroeconomic soundness and stability of Korea, even when global trade protectionism prevails. Under RCEP and CPTPP trade regimes, Korea's GDP may increase even when the global trade environment deteriorates as trade wars occur and intensify between the US and China, or between the US and EU. It is also estimated that RCEP participation increases Korea's GDP, welfare (measured in equivalent variation), and total trade by 1.12%, $1.09 billion, and 2.54%, respectively, while CPTPP participation increases them by 0.19%, $0.92 billion, and 0.13%, respectively. Originality/value - Existing studies usually focus on the direct impacts of mega-FTA participation on macroeconomic variables such as GDP, welfare, and trade, and do not consider the possible buffer effects of a mega-FTA when the global trade environment worsens. In this paper, we analyze and quantify not only the direct impacts of RCEP and CPTPP on the main macroeconomic variables but also the possible buffer effects of the RCEP and CPTPP in the cases of the US-China and US-EU trade wars.

• Korea Trade Review
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• v.44 no.4
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• pp.205-220
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• 2019

This article recapitulates the recent changes in trade laws, which may be accentuated due to the intriguing emergence of fortified protectionism and Mega FTAs. It points out the need to formulate not only the corporate strategy for enhancing the product differentiation and architectural capabilities but also the public policy, which comprises the industrial adjustment policy to cope with possible negative impulses caused by the digital trade and foreign direct investment. It is imperative for Korea to facilitate the alignment between corporate strategy and industrial adjustment policy as an effective means of enhancing industrial structure by nurturing those linkage effects between relevant forward and backward industries. Given the drastically volatile trade norms of multi-track trade policies, it may be a pivotal momentum for Korea to pursue a paradigm shift of its trade policy with a prime objective of achieving such an alignment between corporate strategy and industrial adjustment policy, which affords increased value-added and the further development of product or generic technology instead of resorting to the misuses and abuses of economies of scale and production technology for the maximization of export amount.

• Korea Trade Review
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• v.46 no.3
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• pp.99-117
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• 2021

Korea's FTA e-commerce regulations are evolving into a standardized norm. However, "location of computing facilities", which was not covered by Korea's existing FTA, was newly established in Korea's first Mega FTA, RCEP. China, a member of RCEP, restricts data movement and requires data localization through its Cybersecurity law. These facts have led to start this study with interest in data-related regulations. It examined country-specific and regulatory characteristics in the process of forming digital trade norms, using the TAPED established by Burri et al. (2020). It also analyzed the current status of introducing norms related to 'data flow', 'data localization' and 'data protection' of the EU, USA and China, which are leading the formation of e-commerce trade norms. Finally, the legal review was conducted to compare the exact meaning of the wording expressed in each agreement for the six recently enacted Mega FTAs and Digital Economic Agreements. These findings are meaningful in that they provided implications for the effectiveness of RCEP and the direction of negotiations on Korea's digital trade norms.

• Journal of the Economic Geographical Society of Korea
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• v.19 no.1
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• pp.83-103
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• 2016

This paper examines the characteristics of structural change in the international agro-food trade network with a global trend of the FTA diffusion. By focusing on the centralities and the community structure to identify the agro-food trade network, we use the social network analysis and the trade data contained of 07, 08, 20, and 21 at the 2-digit HS product level among 45 countries over the last 15 years. The main analytical results are as follows: 1) Not only has intra trade network intensified more than inter-regional trade, but also, there is no doubt that inter-regioanl trade by linking has steadily increased. 2) EU countires have the high indices of centrality, which have already been highly integrated. 3) Intraregional agro-food trade network for fresh vegetables and processed food sector in Asia is shown to be strongly integrated. This finding suggests that the processes of economic integration will help strengthen the trade network for agro-food in a culturally homogeneous region. 4) The case of Korea's participation in the RCEP and TPP, Korea's power in the agro-food network tends to be reinforced, especially in the processed food sector. Overall, there is a need for establishment of spatial strategies and policies across the different regions for Mega FTAs.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.18 no.1
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• pp.599-608
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• 2017

This paper proposed a methodology to analyze the economic and quantitative effects of lifting the import ban on Japanese pears by applying a price gap approach in the absence of any preference for either type of pear. Assuming that Korea will allow Japanese pear imports in 2018, the simulation results show that an annual average of 50,000 tons will flow into the domestic market from Japan. These imports will cause a decrease in the price and production of domestic pears, which would have a direct effect on the domestic pear industry, leading to an annual average reduction of 93 billion won. The cultivation area and production quantity are projected to be decreased by 0.7% and 1.4%, respectively, compared to the baseline. Also, the annual average reduction in the overall agriculture sector is predicted to be about 209 billion won, which is a 0.4% reduction compared to the baseline. This research is expected to improve the methodologies available for proactive analysis, with the existing analysis focused on customs tariffs when Korea considers joining mega-FTAs.