Trade Minister Yeo Han-koo held talks with Mexican Secretary of Economy Tatiana Clouthier on Mar 1 in Mexico City and agreed to resume the two countries’ halted FTA talks after a 14-year hiatus, on the occasion of the 60th anniversary of the establishment of Korea-Mexico diplomatic relations.

Korea and Mexico presently share the same concerns over the rising risks of global supply chains from COVID-19 and the Ukraine situation, but anticipate that a bilateral FTA will act as a strategic launchpad for strengthening supply chain resilience, achieving digital transition and responding to climate change.

Mexico is a geopolitically important partner abridging North and South America, with previously established FTA network also spanning the Asia Pacific region, which makes it a strategically critical country. Mexico was the only nation among Korea’s top 10 exports destinations to not have reached an FTA with Korea (exempting Hong Kong and Taiwan). Considering Mexico’s high tariff rates and the two countries’ complementary trade structures, this FTA is expected to improve trade conditions for Korea’s automobiles and steel exports.

This Korea-Mexico FTA encompasses not only the conventional products and services trade and investment, but also supply chain resilience, climate change, digital trade and such new arenas calling for cooperation in the 21st century. Preliminary talks are slated for March, with the 1st round of negotiations set to be held in H1 of 2022.

The two leaders also signed the Critical Minerals Supply Chain Cooperation MOU and agreed to further the dialogue through working-level discussions. The MOU enables rapid information exchange on raw materials supply for prior identification of bottleneck factors and joint countermeasures. Need for such efficient partnership is well illustrated by Mexico's emergency contribution to Korea’s domestic urea market stabilization during the recent shortage in November 2021.

To Minister Yeo’s mention of Korea’s ongoing membership application for the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Mexico responded that it supports Korea’s CPTPP application and requested to be kept informed on the preparation process.

Noting that the Korea-Mexico FTA had been on their shared agenda for quite some time, Trade Minister Yeo stated that “this FTA push will be the new game-changer for the two countries’ economic ties.”