Economic and trade relations between South Korea and China have expanded at an incredible rate since the countries normalized ties 24 years ago, but they must now focus on improving the quality of bilateral cooperation, a report suggested Tuesday.
According to the report from Hyundai Research Institute, a private think tank run by Hyundai Group, the countries' relations have continuously improved, both in terms of size and meaning, since they established diplomatic ties on Aug. 24, 1992.
Such improvements could be best seen through the sheer volume of bilateral trade between the two as China accounted for 26 percent of overall South Korean exports in 2015, making it the world's single largest importer of South Korean goods.
South Korea, on the other hand, was the world's fourth-largest destination for Chinese products, accounting for 7.1 percent of overall Chinese exports in the same year, the report said.
The increase in the number of visitors between the two has been more dramatic.
In 1992, only some 14,000 Chinese people visited South Korea, accounting for 0.6 percent of all foreign visitors to the country in that year. The number has been spiking at an annual average of nearly 30 percent over the past 24 years, reaching over 5.9 million and accounting for 42.1 percent of all foreign visitors to South Korea in 2016.
South Korean visitors to China have also jumped nearly 13-fold from 340,000 to 4.44 million over the cited period, the report said.
The bilateral relationship between the countries was highlighted when they signed a free trade agreement in June 2015 after three years of negotiations. The free trade pact went into effect on Dec. 20, 2015.
The report, however, insisted the countries now need to focus on readjusting their cooperation in line with changing global conditions, as well as their very economic structures.
For instance, the two countries are currently involved in negotiations for a trilateral FTA involving Japan, as well as a multilateral free trade deal known as the Regional Comprehensive Economic Partnership that involves the countries and 12 other nations, including the Association of Southeast Asian Nations.
"South Korea and China are actively participating in an economic integration of the region through their bilateral FTA, as well as the Korea-China-Japan FTA and RCEP," it said.
"The FTAs and RCEP will help further deepen the trade relations between the two countries while promoting regional integration, but on the other hand, they will create much more complex trade relations while instigating a spread of trade protectionism," it added.
Already the number of protectionist measures taken by China is on a steep increase.
The number of tariff and non-tariff measures imposed on South Korean exports to China jumped from 343 between 1992 and 1999 to 814 between 2000 and 2008, and again to 1,597 between 2009 and 2015, according to the report.
It suggested such obstacles to the bilateral trade relationship could be overcome by expanding the countries' cooperation into other areas, including the service sector.
"There is a need for the countries to shift the focus of their bilateral economic cooperation from products to the service industry. To this end, there needs to be efforts to identify non-tariff barriers that work as a hurdle against trade in the service industry when the countries hold follow-up negotiations for the Korea-China FTA," it said. (Yonhap)
