S Korea ratifies FTA with Cambodia; boost to garment-textile exports

28 Sep '22

2 min read

Pic: Shutterstock

South Korea’s National Assembly yesterday ratified a free trade agreement (FTA) with Cambodia, rounding off the final domestic procedure essential for the implementation of the FTA signed in October last year. The FTA, signed into law in Cambodia in January this year and ratified in June, is expected to boost Cambodian exports of garments, textiles and footwear to South Korea.

The agreement also presents opportunities for value-added investments in Cambodia’s downstream processing industries through a ‘plus one business model’, in which South Korean companies could expand their supply chain network developed in not only China but also Vietnam or Thailand.

The Cambodia-Korea Free Trade Agreement (CKFTA) is expected boost trade between the two countries with South Korea agreeing to remove tariffs on 95.6 per cent of products imported from Cambodia, while Cambodia will eliminate duties on 93.8 per cent of imported goods, according to media reports from South Korea.

Cambodia-South Korea bilateral trade was valued at $885 million in 2020 and grew by 9 per cent to $965 million in 2021. Further, Cambodia imported goods worth over $600 million from South Korea in 2021 while exports reached $341 million to the East Asian nation.

The National Assembly also ratified an FTA with Israel, signed in May last year. South Korea is the first Asian nation to have an FTA with the Middle Eastern nation.

Fibre2Fashion News Desk (DS)

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