Ecuador and South Korea will start talks on a bilateral trade agreement next year, according to its top diplomat here.

South Korea agreed to start talks on a trade agreement with Ecuador in the third quarter of 2014, Ecuadorian Ambassador to South Korea Nicolas Trujillo told The Korea Herald at his office in Seoul on Tuesday.

“In the three years I have been here, this is the first time we were able to get them the governments to commit to a specific date,” Trujillo said. 

The two countries had signed a memorandum of understanding to strengthen political and commercial ties when Ecuadorian Foreign Minister Ricardo Patino visited Seoul in June, but South Korea had shied away from committing to a specific time frame for beginning negotiations.

Trujillo said he met on Nov. 30 with Choi Jin-won, director of the FTA Policy Planning Division at the Ministry of Trade, Industry and Energy, to discuss starting negotiations on a trade pact.

South Korea inked FTAs with Peru in March 2011 and with Colombia this February. The two countries are Ecuador’s neighbors to the north and south. The Colombian trade deal was South Korea’s 10th FTA, and its third with a South American nation.

By contrast Ecuador does not have any bilateral free trade agreements.

The country has a history of not welcoming FTAs, with the apparent belief that it could not compete with production from commercial behemoths such as the United States and the European Union, meaning Ecuadorian enterprise would suffer.

“What we are trying to put together are reasonable trade agreements,” said Trujillo.

Ecuador has a massive annual trade deficit with South Korea. The country’s trade imbalance was about $800 million in 2012, and this year it is projected to grow to $900 million, the ambassador said.

Such trade deficits are unsustainable, Trullo said. One plan Ecuador already has in place is to begin to offset deficits with development knowledge through South Korea’s Knowledge Sharing Program.

“We are not going to offset that trade imbalance by exporting bananas, raw fish, or any other primary export item. We have to add value. South Korea can teach us how to add value,” said Trujillo, who was a successful entrepreneur before he took on the job of representing his nation.

A delegation of officials from Ecuador’s Ministry of Health and representatives from its pharmaceutical industry came to Seoul on a six-day trip last week to learn from South Korea’s experience in developing globally recognized pharmaceutical and health sectors.

The two countries are working on a plan to first import South Korean manufactured drugs directly to Ecuador. Later, they will set up joint drug-manufacturing ventures in the South American country. The plan would result in transferring pharmaceutical know-how and technology to Ecuador.

Boryung Pharmaceutical Co. is interested in launching a public-private partnership with Ecuador’s Enfarma, a state-run pharmaceutical company launched in 2009, to build a manufacturing facility for generic versions of common medicines such as antibiotics, as well as sophisticated drugs like biosimilars.

Biosimilars, also known as follow-on biologics, are medical products whose active substances are made by living organisms.

“We consider South Korea to be a priority country. The amount of knowledge-sharing and technology transfers, and the way South Korea developed, makes (it the country) that is most consistent with our own development vision,” he said. “Let’s get South Korea to teach us, to train us, in the value-added expertise they have.”

By Philip Iglauer (ephilip2011@heraldcorp.com)