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The mega Regional Comprehensive Economic Partnership (RCEP) free trade pact took effect for South Korea, Tuesday, which is expected to help diversify the country’s trade portfolio, according to the country’s industry ministry.
In November 2020, South Korea inked the trade deal with 14 other countries ― 10 member nations of the Association of Southeast Asian Nations (ASEAN), China, Japan, Australia and New Zealand ― and the National Assembly ratified the pact in December last year.
It came into force Tuesday, 60 days after the government submitted the National Assembly approval to the Secretariat, according to the Ministry of Trade, Industry and Energy.
The RCEP is the world’s biggest FTA, as the 15 member countries account for around 30 percent of global gross domestic product, population and trade volume, government data showed.
The pact officially went into effect Jan. 1, 2022, for some countries, in accordance with a rule that it shall enter into force as at least six ASEAN and three non-ASEAN nations submit the ratification after wrapping up their due domestic procedures.
“It is expected to help our companies’ advance into overseas markets, as it expands the market for our key export items, including steel and cars, as well as such services sectors as online gaming, animation, film and music,” the ministry said.
The combined amount of South Korea’s exports to the RCEP participants came to US$254.3 billion in 2020, taking up around half of the country’s total outbound shipments, according to the data.
It is also the first free trade agreement that involves South Korea and Japan, the ministry said.