JEJU (South Korea): Asean and South Korea have signed a free trade agreement to boost investments between the regional grouping and the East Asian country.
The agreement, signed by the trade ministers of the countries Tuesday, completes the Asean-South Korea Framework Agreement on Comprehensive Economic Cooperation, the “mother agreement” which paved the way for three free trade agreements to be signed.
The two earlier FTAs were on goods which was signed on Aug 26, 2006, and that on services signed on Nov 21, 2007.
The signing was witnessed by the leaders of Asean countries and South Korea who were attending the Asean-South Korea Commemorative Summit which began on Monday.
The agreement, signed by International Trade and Industry Minister Datuk Mustapa Mohamed on behalf of Malaysia, will help encourage investments between Malaysia as well as other Asean members, and South Korea.
It would also promote Malaysian outward investment to the region and help to further integrate Malaysian companies into the regional economy.
The ministry said in a statement that the agreement would progressively liberalise the investment regime, create a conducive environment for the investors and their investments, and promote co-operation on a mutually beneficial basis.
It would also encourage and promote the flow of investments and cooperation between Asean and South Korea, improve transparency of investment rules and provide for the protection of investments.
The agreement incorporated a review mechanism to improve the transparency of investment rules and to discuss progressive liberalisation of the investment regimes of the countries.
The ministry said the agreement would come into force after ratification by at least one Asean country and South Korea.
Last year, South Korean investments in Malaysia in the manufacturing sector amounted to US$55.5mil (RM184.8mil) and US$325.2mil (RM1.2bil) in 2007.
Malaysian investments in South Korea, as reported by Bank Negara Malaysia, was US$16.7mil (RM55.6mil) last year, compared with US$6.9mil (RM23.7mil) the previous year.
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