China and South Korea have finally signed a bilateral Free Trade Agreement on Monday that will gradually remove more than 90 percent tariffs on selected imported goods in 20 years. South Korea's Foreign Minister Yun Byung-se and China's Commerce Minister Gao Hucheng met on Monday afternoon to sign the deal; a milestone event for economic cooperation between the two nations. 

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The Republic of Korea-China (ROK-China) FTA dictates that 71 percent of tariffs will be removed on South Korean exports to China in 10 years, and 91 percent in 20 years. Meanwhile, 79 percent of tariffs on Chinese imports will be abolished in 10 years, and 92 percent in 20 years. 

A total of 22 sectors will benefit including finance, services, investment, communications, and e-commerce trading. However, agricultural products such as meat, seafood, and rice are not included due to the protests from farmers against the liberalization of these products.

According to South Korea's trade ministry, the pact will give the country's small and medium-sized companies the chance to have wider access to the Chinese market and in turn, increase China's investments in South Korea. 

"South Korean and Chinese leaders today declared an effective conclusion of the FTA at a summit held at the Great Hall of the People in Beijing," said a statement from Cheong Wa Dae (Blue House), the president's residence. 

South Korea's government expects the country's gross domestic product (GDP) to climb by 0.96 percent along with more than 53,000 new jobs in the first decade after the deal is put into effect. The FTA will first be ratified by the two nations' respective parliaments. 

The Chinese delegation paid a courtesy call to President Park Geun-Hye on Monday morning at the Blue House, bringing a letter from China's President, Xi Jinping.

In a statement released by the Blue House, President Park hopes that apart from trade and investment, the two nations will also have a healthy bilateral exchange in various industries, culture, and energy. She added that the deal would help "create a large-scale regional economic community worth US$12 trillion by removing trade barriers, going beyond a simple increase in trade." 

President Xi's letter, delivered by Minister Gao, said that the FTA will greatly help the peoples of the two nations and contribute to economic integration in the Asia-Pacific region and the global economy. He added that South Korea is China's third largest trading partner and the fifth biggest investment destination. 

The trade volume between the two countries are continuously increasing, from 2013's $228.9 billion to last year's $235 billion.

TagsChina-South Korea relations, China Korea Free trade agreement, Asia Pacific Free Trade Agreement, China-South Korea FTA, Republic of Korea-China (ROK-China) FTA