A Research On The Focuses Of Expected Disputes And Relevant Strategies In The Process Of Estabishing South Korea-China FTA

Since South Korea and China established diplomatic relations in 1992, because of their close geological locations, similar cultures and complementary economic structures, various fields, including politics, economy, society and cultures, have enjoyed rapid development that is rarely seen in the world's nation-to-nation relationship development. In May,2010, the two economies officially ended the joint research of FTA and signed a Memorandum of Understanding. Recently, the two governments officially initiate the FTA negotiation. South Korea-China FTA will bring considerable benefits to the two economies, promote the growth of their GDP and improve their welfare levels. However, it will also bring impacts to some industries of the two economies and cause some interest groups to suffer great losses. In accordance with trade statistical data about the two economies, on the basis of studies on the trade development situation of the two economies and their trade structural evolution, competitiveness analysis of relevant industrial items are carried out. Thus, the focuses of expected disputes and sensitive products in agricultural, manufacturing and service industry arising from the establishment of FTA are known. Finally, reasonable strategies that can meet the common interests of the two economies are proposed.This dissertation consists of five parts.This first part is the introduction. It mainly introduces the research objectives, background, relevant literature review, research methods and main views of this thesis.The second part presents the definition of FTA, its emergence, economic effects, status and development under the background of regional economic integration from a theoretical perspective.From a macro perspective, the third part reveals the several development phases, driving force and trade structural evolution of South Korea-China trade since South Korea and China established diplomatic relations in 1992. Then trade frictions and existing problems arising from the development of their trade are analyzed. Finally, the necessity and prospects of the establishment of South Korea-China are discussed.The fourth part analyzes the focuses of expected disputes in agricultural, manufacturing and service industry. Firstly, it carries out research on the development and structural changes of South Korea-China trade in the industries mentioned above. Secondly, through competitiveness indexes, such as trade competitiveness index and import market share, the competitiveness and gap between industries of South Korea and China are analyzed. Consequently, the industries expected to be impacted in the process of the establishment of South Korea-China FTA and specific product categories can be predicted as well as focuses of expected disputes can be found out.The fifth part proposes the consolidation of "South Korea-China strategic partnership in the 21st Century" and strategies that should be adopted by South Korea in its FTA about agricultural, manufacturing and service industry upon the previous analysis results.This dissertation holds that in the process of building South Korea-China FTA, South Korea should build a firm strategic partnership with China, which can create a friendly atmosphere for FTA. Secondly, in accordance with the impacts on its agricultural products, South Korea should adopt corresponding strategies and set safeguard mechanism for protecting the free trade of agricultural products. Meanwhile, it should carry out communication, reach consents and set up mutual-trust relationship with China. Moreover, reasonable dispute settlement mechanism for agricultural products is to be built. Thirdly, in the manufacturing industry, industrial upgrade should be conducted to realize high added-value. Thus, the competitiveness gap between South Korea and China can be gradually narrowed. The restructuring and withdrawal of labor-intensive industries should be speeded up. In order to achieve this, necessary relief plans for relevant enterprises should be made. At the same time, its investment in China should avoid "industrial hollowing-out". Finally, service industry of South Korea should try its best to enter into a high-quality FTA agreement with China that covers many fields and establish most-favored nation treatment mechanism for service trade. The mutual qualification recognition for natural persons'entry and professional workers should be handled in a careful manner. Through the consolidation of the South Korea-China strategic partnership, more opening-up service markets of China are wanted.The research results of this dissertation aims to provide the coming South Korea-China FTA negotiation with policy-based references.