According to Yonhap News Agency, South Korea’s Minister of Industry, Trade and Resources, Sung Yunmo, and Indonesian Trade Minister Supamanto signed the Closer Economic Partnership Arrangement between South Korea and Indonesia (CEPA) in Seoul on the 18th.
This is the official signing of the agreement between the two countries after eight years since the CEPA negotiations began in 2012.
As a result, the market opening level of the two countries based on the Korea-ASEAN Free Trade Agreement (FTA) and the Regional Comprehensive Economic Partnership Agreement (RCEP) will be further improved, and about 95% of commodities will achieve zero tariffs in stages.
Specifically, South Korea has zero tariffs on 95.8% of Indonesia’s goods, and Indonesia’s 94.8% of South Korean goods have eliminated tariffs, which is 1.6 percentage points and 3.3 percentage points higher than the RCEP agreement at that time.
By commodity category, except for automotive steel, auto parts, mechanical parts and textiles, Indonesia has exempted all other exports to South Korea from tariffs, and shortened the tax-free transition period for auto parts such as gearboxes and sunroofs from 10-15 years to 0-5 years.
According to the Ministry of Industry and Trade of South Korea, considering the complementary and competitive relationship between the two countries’ high-viscosity fuel oil, fine chemical raw materials, raw sugar, beer and other commodities, zero tariffs will be implemented immediately or in stages.
In addition, Indonesia has further expanded the opening of the service market, and the online game, retail and construction industry have also increased the openness compared with RCEP.
Cheng Yunmo said that the CEPA platform can effectively reduce tariff barriers for enterprises of the two countries, improve investment conditions, and strengthen cooperation project support, thus promoting the greater development of South Korea and India relations.